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Economic System of 



, EdUtd by 
English R,ndt f in K 
ktAZ NUSAI.V. M- A. 

Islamic Publications Ltd 




lBtf*4fl£lfon I 


The Ecanonics Problem of Mu ... ft 

Real Economic Problem ... 13 

Cass*} of Evils in Economic System 16 

Solution Suggested by Communism ... 25 

Fascist Solution ... 23 

Mamie Solution ... 29 

Economic Precepts oi the Q«ai ... 37 

BUie F*CU mm 37 

Dttonninatioo of Right aad Wrong ii the Prtfogative 

ofAIkh ... 38 

AjHraiationof Individual Ownership ... 39 

Uo-oatural Doctrine of Economic Equality ... 42 

Moderation and Observation of Limits instead of 

Asceticism ... 45 

DwtincUon between Lawful end Unlawful Mont of 

earning Wealth ... 46 

Unlawful Means of-seenring Wealth ... 46 

Prohibition of Avarice and Hoarding of Wealth ... 50 

Condemnation of Materialism and Greed ... 51 

Condemnation of Extravagance ... SI 

Lawfnl Wnyi of spending Wealth ... 52 

Monetary Atonement! — 54 

Pxe-Reqniaitei for the Divine Acceptance of Infaq ... 54 

■ Real Significance of lufaq ... 56 

Obligatory Zekat and its Rate. ... 58 

, Oawftfthofthe Spoils of War ... 60 

Charge* on the Zakat Fond ... 60 

Division of Inheritance ... 62 

Rule of making a Will 53 
Safeguarding the Interest of persons of unsound 


Common Interest ia State Properly ... $5 

Basic Principles of Taxation in Warn ... 65 

Characteristics of the Economic System of Islam Z 66 

Beik Principles of Economic Life 70 

Fundamental values of Islamic Society 70 

The Course of Moral and Economic Evolution in 



Provision and its Use 

The Principle ot Use ™ ^ 

Tne Principle of Moderation *" 78 
Honesty and Justjce in Economic Life 

fWKlflH „a object. «, taMHBk Or|an.s.tto. in 

Form of the Economic System of Islam ... 82 

Objectives of Economic Organization ... 83 

A. ' Individual Freedom ... 83 

B. Harmony in Mo**] and Material Development 84 

C. Cooperation, Accord and EitabLishmt at of 
Jostice 1 j 

Basic Principles «, 

Equitable Distribution „ 

Social Right, ZL 

z*k«t ;;; » 

La* of Inheritance 93 

The Role of Labour, Capitaf and Management 94 

Zakat and Social Welfare * Z H 

Interest-free Economy o$ 

Correlation amoag Economic, Political and Social 



Falsehood nador the cloak of Righteousness Z 100 

First delusion-Capitalism and Secular Efcujocrsey ... 100 


Second delusion— Social lattice and CoBmtrainn ... lot 

Extreme Intellectual Slavery 1W 

The Real Natwe of Social Joitice ... 102 

Social Justice » found ia hJim only 102 

JuiticeiBtbeoDlyObjertlTDonilftn *" ioi 

What i. Sock] Justice ... ioi 

Development of Kama Personality 204 

Individual Reepouatbtbty * l05 

Individual Liberty ^ |0J 

Social Jutittiioiu and their Authority ... 10s 

Defect* of CapitiUua and Communism 107 

Communis U the Wont form of Social Tyranny ... 107 

Mamie Justice , w 

The Boundt of Individual Liberty ... U0 

. Condition! for the EjCfluge of Capital ... m 

R«trktionon6aSpendi n| ofWealih ... U 2 

Social Service m 

Liqttid.HoBOfEaplcit.ftou Z ,,3 

Llmlta Of Nationnlitatton in the Public lateral ] ] 3 
Rule, govern*, tlw expej*. from the State Treasury*" 114 

Aotoqoiiy ... m 

The Difference aatwean Capitalism and Islam 

Distinction between Lawful end Unlawful 

earning Wealth t< I13 

Dan r>n the Hoardiog of wealth "] U6 

Id) unction to spend 117 

Law of Inheritance _ (23 

Distribution of the Spoils of Wai and Conquered 

Property IM 

Injunction (o Economise 125 


(Some Aipectaj ... 129 

Ownership «f Land , |3I 

L.The Holy Quran aod Individual Ownership .„ 132 
2. Precedents established bv ±c Holy Prophet (SAW) 

and to* Right Guided Cahnhl (R.A.) 114 


first Category ^ 135 

Second Category ... 137 

Third Category ... 1 38 

Fourth Category ... 141 

Ownership Rights arising out of colonizatioa ... 142 

Land Grants by the State ... 145 

Shariah Regulation for Land Grail ... 148 

Collect Sbariah position with regard to Fiefe ... 149 

Reaped for the Right of Ownership ... 151 

3. Islamic System and Individual Owsertbrp ... 153 

4. Ceiling on Land Holding ... 155 

5. Form or Crop-Snaring and Islam* Frinciplea of 

/mi ice — 157 

6. Limitationi on the nee of Property ... 15* 

ratareet .» WO 

1. Islamic Orders about Interest ... 160 

The Meaning of Rib* ... 1«0 

Riba In the Period of Ignorance ... 1©2 

Bute Difference between Trade and Rib* ... 163 

The Cause of Prohibition ... 1*5 

Severity of Prob i bition on Usury . . - 166 

2. The need for Intcreet-A Rational Analysis ... 167 

(a) Compensation for Risk ana Sacrifice ... 168 

Ts Interest a penalty ? — 16$ 

Is Interest a rent 7 ... 1« 

(b) Compensation foi the Opportunity and grant 

of time --- 172 

(c) Share in PzofitabiUty ... 173 
fj) Compensation for timt ... 1*5 
Reasonableaefct of the Rate of interest ... 177 
Factors which Determine the rate of Interest — ISO 
Economic Benefit of Interest and its need ' ... 183 
Is lotercjt Really Necessary and Beneficial? ... 18$ 

3. Evils of Interest ... l%9 

4. Economic Reconstruction without Interest ~ 1*4 

Some Misconceptions ... 1« 


First step towards Reform 

1 0? 


Consequences of the Abolition of Interest 


Forms of Credit in ao Interest free Financial System 


. . . r 

Credit far Private N^rl 
vi* u Ji i «■ n i rule JiCtu 


Credit for Business 



Credit for the N on- Productive State Experts^ 

m t * 

International Loans 

v * * 

Provjiion or Capital for Productive Ventures 


Islamic Form of Banking 

■ pi 

5, Economic arid Industrial Loan* from Non-Musliuj 



Tto Natwe of Zakat eaa its Xalti 


The Meaning of Zakat 


Pracadeot of Propheti 

* * ■ 


Significance of Zakat in Collective Life 


The Order of Zakat 

Expenditure of Zakot 

Basin Rules of Zakat A Qucitionnoice 

99 9 


Questionnaire Am we red 


Can the Limit of Liability and the Rate of Zakat 

be Chanced 

• Pi 

Problem of Zakat «s Company Shares 


Zukul in the cose of Partnership and Mudurba 

1 » » 


Limit of Liability for Zukat on Metals 

1 i » 

Distinction between Zakat arid Tu 


is it justified to levy Income-Tax in addition 




ProMemi of Lshpnr and their Salutio. 


• The Real Need 



Solution of Problems 



Principle J of Reform 



Icsaraace and Schemes for its Reform 

■ t ■ 


Priee Caatrol 



t+rotjiftcatiM of Mamie Laws in Modern Times 

* • i 


Ne*d for deliberation before Modernization 


Need for Recodification in Islamic Law 

* « i 



Some essential conditions for Re-codiflcntion ... 298 

First Condition ... 299 

Second Condition m 300 

Third Condition ... 302 

Fourth Condition 3° 3 

General Principle* of Commutation 305 

Some form* of Rotations • • . 307 


Thii ii a talk oc tb* ecoowolc antrm of Mam whte B 
tbe l-rocd uiboc bnadci,t from D,<ji* 

lBth«*»pf thttu will «rrt ., , food iolfO(j0Cli0B 
toth.«afetasumit.r oflA1 , ^ ° u 

T-JTr «onomlc lift of man on tbe line* of Equity ud 

2«h W« , he* laid daw certain rule and has px^riW certain 
bomsda whhin which the entire system of production consul 
turn lad circulation of wealth mutt operate. 

Islam docs not concern itself with the modes of production 
**™*f**<* <* wealth. These mode, change with the pro,™ * 
emrnatJoo from age to age and evolve out of human circum- 
*Uk» and oeeds Itlen requires that la all are and nnder all 
ctrcumitaaoea. the economic order of foolery must conform to the 
rxracmpies and bounds prescribed by it. 

Islam holds that land and everything in it has been created 
by God for the benefit of man. Hence it is the birthright of 
every individual fo secure bis livelihood' from the land. In this 
right aU men are equal. Ko one can be deprived of this right, 
nor can any one claim any precedence over tbe other in this nj- 
pect. The Sharieh eicludcs no individual, race or class from 
avaikng of .ny means of livelihood or adopting any professioo 
^ilarly nodirtJactionscslculatedto reserve certain means of 
livelihood or profession, for some special class, race or Tamil, 
may be set up. Ail men have so equal right and most be afforded 
an equal^portunitytosharein the produce of the God-nmde 
earth. The products of Nature, in whe*e making or finishine 
no man ha B expended h I 5 i.tour or dill are the properly of j 
and every .ndxndtial has the right to avaiJ of them accordion, to 
lus need. 6 


Water of the riven and springs, forest wood, wild fruit, grass 
and pasture, air, marine or desert animals, open mines and all 
sacb economic resovrcco are not the monopoly of anyone nor can 
any restriction on their free use by all and sundry be imposed. 
However, their large-scale eiploitation for basinets purposes 
should be subject to state taxes. It is not meet to let God-nude 
thingi lb on used. Either one should put ihetn to his own use or 
let the others use it. It it on this principle thai the Islamic law 
lays down that no lessee can keep the state-granted land unwed 
for more than thre* years. If he does not bring it under curtiva« 
lion, or build on it or put it to tome other use for three yean, 
then at the eipiry of this period, the land ihafl be treated ts 
evacuee. If some other person occupies it and puts It to use, no 
rait shall be.admitied against him. The Islamic Government it- 
self has the power to cancel the lease and transfer the land to 
someone else for settlement. 

Whoever secures a thing In s natural stale and makes tt 
useful by his own labour and skill, becomes its owner. For in- 
stance, if a man occupies fallow land on which no one has an 
established right of ownership, and then puts it to some use, he 
cannot be evicted from that land. Ownership of property orignv 
ated In this wny according to the doctrine of Islam. In the initial 
stage of human settlement on earth, all things were open to use 
by man. Whoso got hold of a natural thing and made it useful 
in some way became irs owner, that is. he obtained the right to 
reserve thai thing for his own use and charge a price from anyone 
who wished to take advantage of it- This rule being the natural 
basis for all economic transactions among men, it should not be 
tampered with. 

The Proprietary rights which one obtains through lawful 
means must be respected. The question to be decided is 
whether an ownership is valid by Shariah law or not Titles of 
ownership which are invalid by Shariah law must be abolished. 
As for titles which are valid by Shariah law, no Government or 
Parliament has the authority to forfeit of diminish them. No 
system designed to abofiih the rights sanctioned by Shaiiah can 



be established in the name of social good. To Gilt down the 
TCJtricticKW which Shariah haj laid on privale ownership in the 
interest of the community jj as bad as to enhance those restric- 
tion*. It ii incumbent open the fsJamrc state to protect the 
Shaxiah rights of the individual and to exact those rights of the 
commnallt which the Snariah has imposed npon him. Cod doc* 
not observe equality in the distribution of Hb bounties, but in 
His wisdom, gives precedence to tome persons over other*. 
Beauty, melody, health, physical strengh, menial capacity. 

environment at birth in these and seme! other respects no 

two tmmtm being* an equal. 

Similar is the case with livelihood. The Natural scheme , 
devised by Qod itself requires disparity among men in reaped of 
livelihood. Hence in their purpose and principle! all such 
schemes as an enforced with a view to establishing an artificial 
equality among men are wrong ficm an Islamic point of view. 
Islam does not envisage equality of livelihood, but equality of 
opportunity in the struggle for earning livelihood. Islam 
seeks to remove all obstacles, legal or cwtomary. which 
prevent a man from realising hi* full potential in the economic 
Struggle, nor does Islam allow the hereditary advantage of certain 
daises, races or TamQies to solidify into a.periaarjcirt legal right. 
Both modes forcibly replace a natural I acq winy by an artificial 
equality. That is why Islam intends to eliminate them and bring 
the economic system to such a oaiural state that every Individual 
should enjoy freedom of endeavour. However Islam does not 
agree with those who wish to enforce equality io the means of 
end savour and reward, foe they wish to transform natural ineo. un- 
ity into artificial equality. 

Only that system can approximate to Harare in which every 
iamndonl starts Us economic struggle from the place and condi- 
tion in which Allah created him. One who is born with a motor 
«ar should drive ; he who has merely t« , feet (o stand on should 
run on Ms legs; and the one who is bom lame should limp along. 
The Jaw should neither create a permanent monopoly of the 
njotomt over motor car nor should debar the lame from securing 

a motor car. flor indeed should everyone be forced to start the 
economfc race from the sane point ami ia the same condition 
and keep all the pirtidpaat* yoked together on the track. 

On the contrary, while the law should oot come in the way 
of the la*, pedestrian securing a motor car by dint of hi, ability 
and haxdwoft, it should not uncWy protect the motorist tf 
be becomes a pedestrian tkrongh incompetence. Not only docs 
Wan, envisage i nd ^ economic race but it also 
requires that the participants should not be callous and 

Jf 00 **":^ ^ Wpf B I to one another. On 

the one hand Islam develops among its followers a sense of moral 
obligation towards poor aod backward sections of the society 
on the other ft requires the eaublishtnent of a parmtoeot iaatltu' 
(too which should guarantee material «o P ort to disabled and 

helpksa members of (he society. Thoae who an unable to parti- 
cipate in the economic struggle should receive their share of 

'national wealth through toll institution ; th* Institution should 

^^loT^r^ '^stances ■«« 

brought low: and ft sho«Jd ntend support to 'ho« who m-, v 

c«d it for starting off in the K on^J^„Z m " 

¥ TL^ P W P°«' h« enacted ibe law that Zakat at the 
rate of 2*% par year shall be levied 01. National saving, as with 
mob commercial capitaf. Simitariyi 10 or i% of the produce 
of ushr. land. sbH be es acted a. Zak.t Upon certain mtZt 
products the rate .ball be 20%. while on a speciftrd number of 
entile heads a certain ratio of Zakat shall be imposed. The pro- 
ceeds of all I these levies shall be diverted to the assistance of the 

categories of indigwt people Tois is a system of social Tusur 

A - Z T, » e,of ' i,< - M ' M "N«nsn will find him- 
self so driven by (he fear of starvation as to accept any terms of 

'S^J l ^''^ }htar ^ M ^ care to 
offer him a Qd no man', state will fall below thar minimum level 

which ,s a pre-r eq e,s,re for pa,tki P arc 0 i n ec 0llomic ,™ 
Mam wishes to establish , ucb a bsl.ace between Individual 


and society that the individual should retain bis ideality and 
freedom, without undermining public interest but essentially 
promoting it. Islam does not approve of any political or 
economic organization which setts to submerge tbe individual 
In ihc society, and stultify tbe flowering of bit pereonality. 

Nationalization of alt means of production in • country 
inevitably results is social regimentation. Under (his circumit- 
apce tbe preservation and development or Individual person- 
al Uy becomes very difflcult, even iaapotaiblo. Juic at political 
and social freedom is essential for tbe growth of personality, so 
to a Urge extent ia ecooomic freedom. If we do not seek tho 
complete- annihilation of human personality our corporate life 
should allow scope for the individual to preserve his conscience 
by free economic activity nnd real hut the potential of hie 
physical and mental powers In accordance with hit aptitude. 

Rationed livelihood, whoec keys are held by others, even 
if It la ample, cannot be pleasant, for its demoraltsmg 
effect esnnot bo offset by a fall stomach. Jolt at Islam 
abhors a regimented aoclety, so (t alto condemns a lais*z fatrm 
society in which the indlvldoal islos at tbe cost of public inter- 
est. The golden mean between thane two extremes as adopted 
by Islam envisage! that the Individual saddled with certain 
restrictions and responsibilities sboold bo left free to conduct hii 

affairs. This u not the occasion to go iatotha dcteili of thcic 
restriction and duties. 1 shall, therefore, content myself with 
presenting their gist before you. Take tbe means of earning 
livelihood first. No legal system ban set up such a iharp distinc- 
tion between right and wrong mesne of earning livelihood aj 
that of Islam. The law of Islam scrupulously condemns every 
means of earning livelihood whereby one Individual gains to 
the moral or materiel detriment of another individual or 

The Islamic Lav proscribes the manufacture and aah of' 
liquor, prostitution, dancing, singing and music, gambling, 
speculation, lottery, usury, transactions involving speculation, 
cheating and dubtats commercial dealings in which the gain of 


one party fo assured while that of the other ii doubtful, hoard- 
ing with s view to reittng prices sod all other formi of bus'new 
harmful to the community as a whole. A study 'of the Econo- 
mic Law of Iilam wilt reveal to you a long list of the Prohibited 
means of Earning Livelihood, including several of those by which 
under the present capitalist system individuals become million- 
aires. Islam imposes a legal ban on all such mcaas and 
permits man to cam his livelihood by those means only in 
which he receives i fair return for geouine and useful service 
rendered to others. 

Islam acknowledges a man's sight of ownership over that 
which he has earned by lawful means. But even this tight is not 
unlimited. Islam binds a man to spend his lawfully earned wealth 
in lawful ways only. It has damped such restrictions on expendi- 
ture that a penon can lend a clean aod pure life but cannot 
squander his wealth iQ voluptuous living nor can be adopt so 
ostentatious a style of living ai to inspire awe in others. Some 
forms of extravagance have been clearly prohibited by Islamic 
law whUe regarding some other forms of extravagance which 
have not been explicitly detailed, the Islamic Government 
is authorised to put a bin on Ibta. 

A mao can keep wealth left with him after legitimate and 
reasonable expense and invest his savings in a profitable venture. 
However these two right* are alio subject to limitations. If the 
amount of bis savings exceeds the statutory limit, he shall pay 
Zakat out of it at the rate of 2\% per annum. He shall in- 
vest his savings In lawful enterprise onjy. Whether a man sets 
up his own business or invests bis capital in the form of cash, 

land, implements or goods ia somebody else's business, both 
forms of investments are Legitimate. 

Working within the above bounds if a man docs become a 
millionaire, Islam will not interfere with him. His goad for- 
tune will he regarded a» « boon from God. Yet in public 
Interest Islam will impose two conditions on this millionaire. 

One, he shall pay Zafcat on his trade goods and ushr on 

fKmouuCTroH i 

agricultural product. Two. he sha I i deal fairly with bis bust- 
ncas partner! and employed. Jf be fails in ibis duly, the 
Islamic Government will apply coercive measures to bring him 
to (he paib or jtmici. Furthermore. Iilem doet not allow 
the wealth earned within then bounds to remain 
concentrated in the same hand for long, but by the 
Jaw of Inheritance, rediitrtbucee it el the end of every gener- 
ation. In thjs matter the tendency of Isjamic Uw it unique 
among tbe legal systems of tbe world, which endeavour to keep 
wealth concentrated io tbe woe family generation after gener- 
ation. Islam 00 Ibe other hand hn enacted that wealth accum- 
ulated by a nan ahull be distributed at hit death among bis 
nearest relatives. If there are no ocurc.t relatives, the diltant 
relations shall inherit the deceased's wealth according to tbe 
prescribed ratio. If however, oo near ur distant relative of 
the deceased is forinooraing, tbe state shall inherit his pro- 

This Law militates against tbe perpetual maintenance of 
large capital or land-holdings. 

In spite of all ibe above restrictions if any evil does 
result from the conceal ration of wealth, thin last blow comple- 
tely eliminates that evil. ^ 

(By courtesy of Radio Pakistan) 

The Economic Problem of Man 


Its Islamic Solution 1 

«n J«r """Tit Pr ° b, " a " bich wnlp: " in «*• *•» 
-B^ orour.nWhciimltaftbrtBwtf Wore ..Lined .o much 

««d prommence bec.u.e, „ . m .„„ of f « t . the toporlsnce 
which economy naturally bu for .he life of m.niiid ha, , ,l wa ™ 

" f 'jT^ «■«*«*»"■ CMi-Mitk.. nation.! 

woojri*. and mdeed .11 me* to pay due a.tentjon 1o it. Bui in 

oou. boo*., w,.h tigo^cEtfing . enD inolo.y and t.rae 
«™ i °" 0duced ln ,h ' PtoduefioD. distribution and «gul.i- 

probleiEi.lhiimru.ariian .he oihe, problems „f BUkM 

* c °™" 1 « and more complicated. In f acl hal fc™, 

econormcs and the scholarly sub.k,«- s and nair spMlli of 
econom.c experts have » confounded aud mystified toe ordinary 

a„ '•<*«"*'»**''»' ■"!>«•"' "> 'I" Mulirn V*in„l»7 
Alltarh, on !0th October, 1941). r 


people (hat the poor fellows, on hearing these expert discussion*, 
stand aghast before the complexity of their economic problem 
and ioseaHhor* of its solution, like a patient wbo is frightened 
on hearing from h in doctor a bigghfa Latin name for his disease 
and tbjnks that he can be cured of hi* indisposition only by the 
*P«i3f grace of God, In point of fact, however, if the smoke- 
screen and cloak of this scientific terminology and technical 

V" e aS ' de aodthem,rt, " is ^kedati n it S p| a i Q> 
natura/ wmplicity. the economic problem of man can be easily 

?H7! S !T d> th . e BdvaB " 8MU8 «»>« tB of various solutions 
adopted can be examined without difficulty, -nd the correct 
so.ut.on of this knotty problem can come within easy ^ of £ 
ordinary man. 

Apart I he magic „f professional complication, and Ibe 
"gra.role or terminology round Ihi , prob i enli . fur|b „ 
completion has ausen by fact that (be economic 
problem of man which was. indeed, . p „, nf Ihe ptob|cn , 

% amm "'*• h « "Paraicd from ibe whole and looked at 
« tf U were an independent proWen, by ilieJf . And gto d ulUy lhi , 
attitude h.5 taken such . fim l0M lhat , he econotnic blem 

has come to be regarded ai the .olc problem of life. Tnis is 

rfj an expert ,n liver diseases isolate. Ibe liver from the whole 

S^TV"?" ""V 1 *"* 1 * P"'«°" ""°«*d to and 
YJ? ™ ' be buD,an bod> ' and ' ,s "lationship 
TnJ h y W *" r ' 5 '«*»•.»« ">= 'iv« in isolation ; 
it - , .k"T c D " ,C '' abS ° rbfd 111 115 ««»i»«k". thai 

.*» livens* attitude, bow iorosaible of aolution they would 
becon,. and to «h„ esircme danger. *iu human life be exposed. 

k, .v"™/'' " ■» isolated and segregated from 

nil the problems of life by mens of economic panacea, as if man 



were no mote than an economic animal and his moral and spiritual 

aspirations have no reality apart from his economic endeavours, 
you should not be surprised if chaos and confusion are the final 

Believe me, the existence of experts and specialists is one of 
the many calamities of modern age. A comprehensive and 
general outlook on life and its problems is ©scorning rare evwy 
day. Man has become a toy in the hands of one-eyed specialists 
of the different sciences and professions. If there is a physicist, 
he starts solving the riddle or the universe on the htreoglh of 
physics alone. If one is obsessed by psychology, one seeks to 
build up a whole philosophy of life on the basis of his psycho- 
logical observations and experiments. If a man't knowledge in 
confined to sexology, he announces straightaway that Ihe whole of 
human life is rotating on tbe axii >»f \cxual passions so much so 
that even the idea of God entered the human mind through this 
door. Similarly people who are engrossed in economics seek to 
convince mankind that (be real problem of their life is ibt 
economic problem and all other problems are nothing but its 
off-shoots. As i matter of fact, all thete problems should be 
considered together as a whole and each separate problem ought 
to be viewed as a special aspect of the single totality. All of 
them occupy a particular position in this whole and derive tneir 
importance from that position only. Man possesses a physical 
body which is subject to physical laws ; from this view-point man 
is the subject of physic*. But he is not a mere physical body w 
that all his problems could be solved by phyaica alone He is a 
biological being as well, subject (o biological law, and fiom this 
point of view he is the subject-matter of the science of tbe biology 
also. But then again he is not merely a biological animal and 
a complete system of laws for tbe regulation of life cannot be 
deduced from the science of biology or zoology. In order to 
sustain bin life be needs food, clothes and shelter ; and viewed 
from his stand-point economics covers an important aspect nf 
sis life. But be is not merely a food, clothing, and shelter- 
seeking animal so that the wnole philosophy of his life could 

tug tcoKomc noBUW II 

wJ^"™ °h\ tcoaomict • tooe - «* Privation of 
w V m ™ ha *" rou "»'° r «P">*>*tlooa n d there i. , here . 
fore found .o h.m « .irong lead.ocy. Considered 

for h. l,fe. But here ,g„a he i, no i wholly .» iartrument of 
rep.oduet.on < 0 be ,» miaci merel,*,^^,, "Ce. 

ledge .ad coga.l.on . n d eh.rged with p.saiow and desire. 
From th,, po,ol or view psychology .overs . ,. rg0 p „, of " ( 

eh*. J" ' fe , U JeJu «°"^"«P'lDCipl«of p.y. 
rtology. Man « .l.o . ,oc,a> b.,og obliged by hi. very nature 
ro m« with other hum.* being,. From ,hi. point of view 
m.ny .spec, of hi, lire f.„ under .ocio.ogy. But hi, sociality 

foolish ir the sc.eoca of sociology if re ii ed apoa ,„ forDj|h „ 
complete blue-prln. ofhi. life. Man i, „ iatell.eta.l ^ 

who,e nature demand, the s.ti.f.etion of hi. reMon a, w,H 
Jron, ,h, polD t o f vie. ,.,„«., lclence , "J^ 
h, spec. T . ou „„„„ Md dcmJod , flu » « 

b.rdly furn„h the full ra . ( „|.| f „ . c01np , e(e ^ of 

In;,!,^". 1 ' ' " d 'Pi'^rl b«»J 100. exweUing 

iDCtion between good .ad evil. lnd pc.ening an innate urea 
to reach out ,0 re.litie, fcyond the comprehension of re.,00 
From .his point D r view the moral and splrttoal K ieac<a satisfy 
• Important dem.ud of mans n.ture But .', ? 

». » not .1 moral, a ,d spint from top to bottom .0 thai 

1,1 1", y s "" k "»»- ra " i« «» the,e thing, taken 
•ogether wh.le apart f Iom them, the,. „ , my ig^,,., 

fact to be con.idered about him, namely. , B .t with ,11 h i. 
fcetog and , n all the different «p eC | t of hi, life he i. part of 
he «,t and unmet,,. »y,.em of to I, universe. Viewed from 
On Mud-pout, the oudioa a, to what po.itjon he oeenpie. 
« lb., un.verse and how he should work a p.,, of it 



the highest significance, for unless bis position id the universe 
is correctly determined, no satisfactory code of Jife and 
conduct cud be evolved for him. It also becomes necessary 
for man to determine the objects for which he should work 
and to decide whether those objects are consistent with his 
dignity and the position which he occupies in the universe. 
The last two questions are fundamental to human life. Il U 
on the basis or these two fundamentals that ■ whole philosophy 
or life is evolved, and under the influence of that philosophy, 
all sciences which concern mea and the world accumulate facts 
within tbeir owd respective spheres and on the basis of con* 
elusions drawn from the facts aiife programme is chalked out 
for the guidance of man. 

It should be quite .clear now that if you wish to understand 
any problem of your life, it is wrong to confine your attention 
microscopically to that particular problem alone or to look 
upon life as a whole with a preconceived bias in favour of that 
particular branch of life to which the problem i» more nearly 
related. Rather for a correct understanding and true com- 
prehension you shall have to look at it in its relationship with 
other problems with a clear idea as to the correct position it 
occupies in the complete whole and (hen proceed to examine 
the matter with an unprejudiced and impartial mind. Similarly, 
if you 6nd anything wrong with the equilibrium and balance 
of life and desire to put it aright, it will be still more dangerous 
if you treat one of the problems of life as the whole problem 
and revolve the whole raachiaery of existence on that particular 
point. If you do this, you will merely upset the whole balance 
oaCe again. The correct method of reform is to examine *hh 
an unbiased mind the whole scheme of life, from in basic 
philosophy right up to the details into which it branches off 
and then to locate the evil and discover its true nature. 

So the main reason for the difficulty encountered in under- 
standing and correctly solving the economic problem of man 
is that some people look at this problem from the point of 
view of economic* alone ; Others exaggerate its importance and 


Mart it to be the whole problem of life ; stiU others wish u> 
build • complete philwophy of life iod the whole system of 
moral,ty. cnlture, end society on economic foundations only 
end Id this meaner tbey have reduced man's position ia thii 
world to that of ft free grass-eater in a put arc. for if economic* 
fttoneweretobethefoondttiooofhoQiiii life, then the Idee 
for which man exists is no better than that for which a bullock 
exiiti, namely, to fatten himielf merrily on the green grass. 
Likewise, If the economic stand-point predominates in (he 
spheres or moral, spiritual, rational, sociological, psychological 
and other .cjencei, it wi:; read toavery great diaeqailibrjnm, 
oecause in these spheres of life, economics has do application 
wh.1so.ver Applied to these .pheres economic will convert 
morality and spirituality into selfishness nod materialism, 
transform the rational sciences into the Culinary art*, infuse 
business motives and commercial ideas in social conduct and 
lead psychology to study man as merely aa economic animal 
Cm there be a greater injustice to humanity ? 

If we look at the question ia a plain, straightforward 
manner avoiding terminological and professional com pi ica- 
,00, we find the economic problem of max, to be no more than 
this ; with a view to sustain and advance bo man civilization 
how to arrtoM sconomic diminution so as to keep all men 
supplied of the oecesMties of „i,tnnce and to .„ that every 
individual .n society ii p.ovided with opportunities adequate 
to the development of his personalty and the attainment of 
the highest possible perfection according to his capacity and <bc 

In the earlier Umes the ecoaonic problem was almost as 
simple for men as it is for animals. Infinite means of life we're 
scaucred on God's good earth. All that was needed to sustain 
the life of the human species was available in abundance. Every 
one went out to seek bis potior, and obtained it from these 

'HVT*' N ° °" * td t0 W * e pric * of his ' n««=stities nor 
*99 one mans portion in the grip of another. Tbis holds 



good even today a* far a, animal* „ € C00ccrne(i . Bot , 

2?S? J !?/ oouta ^*™ reo °*''«toraJ food, either (q 
he shap, offrnsts or by huntJDg animal,. o« couid ma 

tf>d rcf l ii B whe BC vcrh e fog B d « w i I .bJ t pja«. But Qod drd 

had endowed b ni w,tb an innate Wg e to seek out and substitute 
«00icii W M We J-tad of bohMd MiVJdaif life 0 o he was bom and by hh own .labour to create for himself 
better mean, of lire than those with which nature had furnished . 
him. The natural desire for a percent relationship between 
man end woman, the dependence of a hamao child for . longer 
period on tba protection of hit parent,, the deep interest of 
man id b* progeny aod the arTectron between blood relation. • 
three were the thing* which nature had ing,nioed in him 10 
direct h„ efforts toward, baUding a .ociaj lift. Similarly, not 
being cnotent mtoral product, but producing foodgraioi 
forbitnieirb* tilling the land ; not being ..tiifled with covering 
hi, , body with le»v« but producing doth for himself by bis own 
industry ; not Jjvicg i D c av« and dens b« construing bouse, 
for bimseir; not considering it , omc j, fll IO iafjsfy hj> nwJj 
with physical implement* but inventing atone, iron, wooden . D d 
other implements; all thee urge* bad been Implanted in him 
by Providence and necessarily inspired that be should gradually 
become civilised. Hence if man became social and civilised 
he d.d not commit my crime; rather this wa. the inherent 
demand of his nature and The deliberate purpose of bis Creator. 

With the advent of cfvilisstion ccriain thi Dg > were in- 
evitable, e.g. 

(1) that the necessities of bumaq hfe should multiply aod 
no single individual be able to secure all his 
ties, some of which must be secured for him by other., 
while he himself should secure a part of the nccessiiies 
of others ; 

(2) that the ntcessitie* of life should be exchanged and 


gradually some medium of exchange should be evolved 
and established ; 

(3) (bit tbe means of production for the necessities of 
life aod means of transportation and communication 
ahonld multiply and that man should take advantage 
of all (be inventions which may coma lo hi* knowledge; 

(4) that man should hare the satisfaction and assurance 
that tha object, which be baa second by hi, own 
industry, the implements with wbicb he works, the 
ground on which he has built his bouse, and the place 
where he carries his professional business, ail these 
will remain la fait possession, and after his death be 
transferred to those who may be nearer and dearer to 
blm than 

So the appearance of vorloui trades and profeeaions, the 
aliens of purchase aod lale., the fixation of price, of com- 
moduiea. the Introduction of coin, . st^daid of price and . 
inrdion of exohaoge, international commerce and export and 
Import hoiineas. the utilisation of all aottt Of new means of 
production, end the evolution of the right* of property and 
succession; all that was quite natural to map and there was 
nothing sinful in it of which be Vhould repent. Besides th|, the development of social life it was also necessary : 

(!) Ib-t owing to the disparity which nature Itself has 
created in the potentialities and powers of different 
individuals, some Individuals should be able to earn 
and produce more than they need and some should be 
able to secure only their bare necessities, while others 
even less than what they need ; 
(2) that some individuals should be able to lacoro a better 

"art in life in consequence of inherited wealth, and 
tome should start iheir life with fewer means, while 

others should start their struggle in life without any 
means whatsoever ; ■ 
(3) that owing t 0 rhc operation of natural onuses there 


should be found ia every social aggregate men who are 
Unfit to participate in the busiest of life ; for ciample, 
children, the aged, the aick and Incapacitated persons; 

(4) that there snoold be certaia individuals who offer 
themselves for employment and certain others who 
secure their service* aod by this means besides the 
deveTopment of free industry, trade, aud agriculture, 
the relationships of employer and employee assume a 
social importance. 

All these factors are, also, ia their own way, the natural 
consequences sod phenomena of man's social life, and their 
emergence too is hy no means an evil which may call for 
suppression. Unable to trace the real source of the evils which 
flow from altogether different social causes, mtoy people lose 
their levclheidness and start denouncing individual ownership, 
money, or machines or the natural inequalities of humanity, 
and sometimes civilisation itseir. This is. however, in reality 
a case of wrong diagnosis and wrong remedy. 

Any attempt to check the natural process of social evolu. 
tion and to eliminate those essential aspects of social life 
which are the products of basic human nature Is, certainly, 
devoid of all sense and, involves a greater possibility of loss 
than that which is tried to be offset. Th ff real economic pro- 
Wem or man does not consist in finding out bow to prevent the 
development of civilised social life or to interfere with the 
natural course of its advance and eliminate its essential aspects; 
the real problem is bow, while keeping intact the natural 
evolutioa of social forces, to prevent social tyranny aod 
injustice, to fulfil nature's demand that every creature should 
receive its portion, and to remove those obstacles which cause 
the faculties 8nd powers of a large number of persons to bo 
wasted away merely on account of lack of necessary means. 
The Causes of Eviis in the Economic System 

We should now examine what arc the real causes of the 
present economic evils and what » tb.e nature of this evil. 



Evil in (be economic system begins wbca the natural Selfish- 
ness of man exceeds tt» limit* of moderation. Ii develops 
wiih the aid of certain other imraor«I habit* and receive* 
further support from an inherently defective political system, 
especially if the latter hn no rnaraJ basil. After throwing the 
whole economic system oat of gear, it poisons the entire social 
life in all its ramifications. I have explained thai both 
individual ownership of property and the fact of some 
individuals being economically belter placed "baa others were 
in accordance with the natural acherae of thing! and are no 
evils by themselves. No evil effect could arise from them if 
all the moral qualities of man had had the opportunity to assert 
themselves in their proper balance and true proportion and 
if externally a political system existed which would msintala 
justice at all costs, even if it came to the application of force. 
But what transformed these two thin** into positive evils is the 
fad (hat people who were in a better condition economically 
owing to the operation of natural causes fell a piey to selfish* 
nasi, narrow-mindedness, jealoo.y. miserliness, greed, dis- 
honesty and worship of the self- The devil put into their 
heads that the means of Jiving which they had acquired in 
excess of their real needs and to which they had full proprietary 
rights, could be spent rightly and rationally in two ways, tit., 
(1) la their own comfort, pleasure, recreation, embellishment 
and good living and (2) In acquiring farther means of living 
and If possible in getting hold of the means of other people, 
[hereby erecting themselves into veritable dami-goda. The first 
satanic idea resulted in the rich refusing to recognise the rights 
of those members of the community who were deprived of a 
share in the distribution of wealth or who obtained a share 
}c» than their real needs. The rich consideied it perfectly 
correct to leave these peopla in starvation and destitution. 
Their narrowmindedness did not permit them to realise that 
such an attitude would bleed professional criminals ia human 
society, produce meo steeped in igoorance and meanness, 
make them a prey to physical weakness and disease, and that 



the physical and mental powers of these person* would be 
arretted in their development sad prevent them from playiog 
their part in tbeevolwiou of hnman culture aod civilisation 
and this would injure and damage that society u a whole of 
which the rich themselves were a part. Not content with this, 
tbt wealthy folk maliiplied their necessities of life very much 
over and above their real needs, and for the purpose of fulfilling 
the artificial and self-created requirements of their self-nature, 
they made many of those persons who could have served civilis- 
ation in their own way as subservient to their selfish persons 1 
ends. H#nce for these rich people adultery became a necessity 
for which an areay of prostitutes, go-betweens and disreputable 
ageaii had to be recruited. For them music was a regular 
need, to satisfy which another army had to he secured, of 
musicians, dancing girls, drum-beaten and manufacturers of 
musical instruments. For then it was necessary to have 
numerous unhealthy recreation for which purpose a Urge force 
of jesters, actresses, storytellers, photographers, painters aod 
other useless professionals had to be raised. They also felt 
the need of bunting far the sake of which many people, inxtead 
of being put to some good work, were called upon to drive 
about animals In Jungles. They also wanted pleasures of 
intoxication and fonetiulneis, for which purpose a large 
number of men were engaged to prepare liquor, cocaine, opium, 
and oiber drugs and intoxicants. In abort, these brothers of 
the devil did not stop merely at involving a large portion of 
society in moral, spiritual and physical degradation, but were 
cruel enough to divert big porlion or humanity from proper, 
and useful occupations, and force them to take up useless," 
mean and hanr.fol jobs. Thus they misdirected the pace of 
civilisation and turned it into channels which were to lead 
mankind To destruction. And the matter did not end here. 
Id addition to wasting all this human capital, they also misused 
the material wealth in tbefr possession. They professed the 
need for palaces, big bungalows, gardens, recreation grounds, 
dance halls, etc., so that even after death the wretched fellows 
required for their rest whole acre* of land and spacious tombs- 


In (Mi way the laud, the baildiog materials, and the human 
labour which could very well h*v= provided the residential 
needi of other hunimiH»eia8«,woimtf]i»cd for ttw temporary 
resort and permanent reside nee of each tingle one of these 
pleaaure-loTloa people. They considered it necessary to have 
jewellery and ornaments, fine dresses, high class crockery 
cutlery and other utensils, of ornamentation and 
dworalion, hiihclart means of rldini, mod God alooe knows' 
what other paraphernalia, so much so that erea their doors 
were considered to be naked without costly curtain*, -nd iney 
could not suffer to keep the walls of their palace, bare of 
pictures costing hundred* mod thousands or rupees. The 
floor of their room, required to be covered with carpets costing 
thousands of rupees that even their dots required golden 
collate and velvet cotbioos. la this manner a good deal of 
that raw material a-d much of that human labc-nr which could 
have been used to cover the bodies and flit the bellies of 
(housaoda of human beings was devoted to the seir-iudulaenc* 
0fo 0e single individual. 

Such waa the result of one part of that utaoic guidance. 
The result of the second part proved to be worse. In the first 
place, it is obviously wrong in principle that a person ihould 
be entitled to amass all the mean, of living over and above hit 
real needs which he may nave come to possess and continue to 
use them to secure further mean*. It is evident that the means 
of living which God has created on earth are meant for sail* 
fyiog the real needs of mankind, ir, therefore, by sheer good 
luck one fiodft himself possessing more of these means than his 
requirements justify, it only implies that a surplus which was 
really the portion of others has reached him Why should he 
therefore hold it for himself ? He shuuld look around for 
people who are not fit to secure their portion of the means of 
living, or who have failed to secure them, or again who have 
received less than their needs, and he should realise that it it 

these fellowt whose portico has come into his hands. As they 
could oot secure it, it behoves him to transfer it ip Ihgm. ft 



will be wrongful act if. Instead of doing this, which it the 
proper thing to do, he starts using them for securing further 
means of living, for. in any case, the further means which he 
will secure will be much mote than his real needs and require- 
ments, Hence, in attempting id secure tbera, nothing is gained 
except the satisfaction of hii greed and avarice. The portion 
of time, Industry and ability which he spends in securing the 
means of living commensurate with the real needs of his life 
are doubtless well and truly spent, but to spend them in securing 
something over and above bis rent needs, implies that he Is 
degrading himself into an economic animal, nay a wealth* 
producing machine, whereas there are better methods of 
spending hit time and energy and exercising his mental and 
physical faculties in pursuits other than the acquisition of 
further wealth Consequently, from the point or view of true 
reason and nature the very principle which the devil has 
Inculcated among his pupils is tobereotly wrong. But, further- 
more, the practical methods adopted on the basis of this 
principle aro so accursed and their results so horrible that they 
cannot even be correctly assessed. 

There are two methods Of utilising the surplus to secure 
further means, i.t. 

(1) that they should be lent on interest, and 

(2) that they should be invested io commercial or Industrial 

Although both these methods differ to some extent in their 
nature, 'the inevitable result of their combined action is the 
division of society into two classes : one, that small class 
which possesses means of living over and above its require- 
ments and employs those means to grab further means of 
living; and the other, thai large class which possesses means 
just according to its needs, or in a measure less than its 
needs, or does not possess them at all. The interests of these 
two classes not only clash against each other but inevitably lead 
to mutual struggle and strife. And thus tbe economic system 
of humanity which Providence had bajed and built on mutuai 



cooperation and exchange ends io internecine struggle and 

As this strangle develops the richer class steadily decrease* 
ia number while the poor class goes on increasing for the very 
natnre of ihe struggle is such that a wealiby individual 
attracts by force of his wealth the means possessed by others 
less wealthy than himself, (hereby throwing the latter down 
into Ihe lower stratum. In this manner the means of "life io 
the world are becoming gradually restricted and confined day 
hy day to a lesi and less portion of the population, and the 
greaier part of the population if slowly and steadily heading 
towards sheer poverty or absolute dependence on (be rich. 
In the beginning the struggle Harts on a small scale ; then the 
infection spreads by stages to all countries and nations so that 
even after bringing the whole world within its tentacle? it still 
criei for more and more. Thus when it becomes a general 
practice In any country that those possessing wealth Io excess 
of their needs should invest the surplus in profitable under- 
takings and in the production of the necessities of life, 
the investment can yield full profits only if the entire 
product of industry is purchased by the people of the country 
in which the surplus wealth has been invested. Bat. in 
practice, this docs not happen, and in reality it eaonot happen, 
because those who possess less wealth than their needs have 
consequently leas purchasing power, and cannot purine all 
the products m spite of tbeir need for them. On the other 
band, those who poaaeia wealth In excess to their needs arc 
anxious to set aside a portion of their incomes for further 
investment in profitable undertakings and therefore tbey do 
not spend all the money they can in purchasing consumer 
goods. This results perforce In a portion of the manufactured 
products being left unpurchased or, in other words, a portion 
of the investments of the rich people does not come back to 
them and lies at the debit of the country's industry as a loan. 
This constitutes one cycle only. You can imagine, however, that 
in every one of the numerous cycles of this nature the wealthy 
classes will goon using a part of their returned income In 



fgrUier investment and in every cycle that proportion of their In- 
vested wealth which does not return ioto their hands goes on in- 
creasing, 'thereby multiplying the debts of the country's industry 
two fold and even thousandfold* and even to an extent which 
that country can never be in a position to pay off. In this 
manner no alternative is left to the country to escape the danger 
of bankruptcy except «por ting for sale to other countries goods 
which are left ov$r and cannot be sold in that country. This 
ia really too tantamount to seeking countries to which this 
misfortune of bankruptcy can be transferred. In this way the 
struggle transcends the harrier* of a single country and steps 
into the international sphere. 

It will now be evident that it It nol jut one country which 
is running its affairs on the basis of tbia sataoio economic 
system; rather most of the countries of the world ire in ihe 
tame predicament ; that is, they art compelled to save them- 
■elves from bankruptcy or, ha other words, to transfer their 
bankruptcy to iome other country. And tbia kadi to interna- 
tionat rivalry which takes *h* followiDg forma ; 

(1) Every country. In offering its goodi In the international 
market, tries to produce the greatest quantity at the 
minimum cost of production, and this involves the 
scaling down or wages of labour to the lowest possible 
limit, so that the portion of national wealth which 
comes ioto ibe hands of the labouring classes is further 
reduced and its income fails to a lever whtre even its 
bare needs are not satisfied- 

(2) Every country places embargo on imports wit hid its 
boundaries and spheres of influences, and tries to 
monopolise for itself the raw materials which He within 
its territory so ihat other countries may not secure 
and take advantage of them. Tbia results in interna- 
tional struggle which leaas to war. 

(3) Thrte exploiting dacoits invade those countries which 
are unable to keep off this bankruptcy from being 
imposed upon them and not only do they try to sell 


to those countries the surplus products of their own, 
but they try to invest their surplus capital Tor which 
lhpy do not find any avenue* of profitable investment 

in their own country. Id this way, the same problem 
ultimately appears in those countries which had 

originally arisen in the countries of the investors ; 
that is, the full amount of investment cannot be 
returned and a major portion of the income this from 
investment is again invested in some profitable business 
so that the burden of debts increases to such an extent 
that even if all these countries were sold off, the invest- 
ment would not be recovered in full. It is evident that if 
(bis cycle is allowed to work in this manner, the whole 
world will ultimately lose its solvency, and no place > 
will be left to which the blight of bankruptcy could be 
transferred. And in the end mankind will feel the 
need of seeking markets In Mars, Venus, and Jupiter 
for investing their wealth and selling their surplus 
goods. Thus, through this international exchange, a 

handful of banker*, brokers, and industrial and 
business magnates to completely gather in their 

clutches all the economic resources or the world that ' 
the whole of humanity is reduced to a state of depen- 
dence upon them. It has now become well-nigh 
impossible for any Individual independently to under* 
take any work or business relying merely on his own 
physical and mental powers in order to secure fbf him- 
self a portion of the njesns of living which exist on 
God's earth. No opportunity is left in these days for 
small industrialists and agriculturists to cam their 
livelihood freely. Everyone is compelled to accept 
the lot of slaves, servants and labourers of these 
financial princes and captains of industry. And they 
exploit all the physical and mental faculties as well as 
the whole time of other people giving them in return 
only a bare minimum at wages at the subsistence level. 



lis accounts for the whole of humanity having been 
reduced to the lot of an economic animal. There are 
very few lacky iodividuala who can, find the oppor- 
tunity, in this economic struggle, to do something for 
their moral, intellectual and spiritual advancement 
or to give some attention to any object nobler and 
higher thin the oi«re filling of the belly, or to develop 
those natural endowments with which God has gifted 
thcro for any higher end than the mere seeking of 
livelihood. In point of fact the economic struggle 
has become so serious and strenuous owing to this 
latinic system that .all the other department of life 
have been affected by it and entirely put out of action. 
It is Still more unfortunate for humanity that moral 
phjloiophies, poliiieaj system., and legal principles of the 
world have also been infected by this devilish economic 
•yitcra. From east to west, everywhere, moral mentors are 
laying stress on economy. It is regarded as foolish and 
moiiHy reprehensible to spend all that one earns, and every- 
o» is told that he .bould save something out of his income 
**d have hii savings deposited in ibe bank or purchase an 
insurance policy or invest it in stocks and shares of ioiat<stock 
companies. This mean, that what is ruinous f or humanity 
has become the standard of perfection and virtue in the eyes 
of ihe modern man. As for political power it has f a || gn i n 
the handi of a sat.nic system which instead of Ba vi D g man kind 
from tbs tyranny, h „ ilS€lf hecome , he inslrumcal ofIaal 

tyranny ; and a class -,f godless materialists are found sitting 
tight everywhere on the seats of pow c r. The laws which govern 
the society are also being framed under the influence of this 
same system. These laws have given full freedom in practice 
to the struggle for individual economic Intcrem against 
th( interest, of the coma ua fry in general. The distinction 
between right and wrong, juit aod Unjuat, in the acquisition 
of the means of living has very nearly disappeared. Every 
method by which an individual can enrich himself whether by 


rubbing or mining other people, ii permissible io the eyes of 
thfi Iftw. Wine may be brewed and told ; centre* of Im- 
morality may be cttablisbed ; immoral filo» nay be produced ; 
obscene writing may be published ; pictures Tor exciting 
pillions may be advertised ; speculation may become rife; 
Institutions for earning interest and usury may be established ; 
new methods of gambling may be iorented ; In short, any-' 
thing one likes may be done, and not only will the law permit 
one to do so bat it will area protect ono'i so-called rights. And 
then the law requires that the wealth which has by this means 
become concentrated in the hands of an individual should 

reinain soc^ceDtrated ev« n afler hi. death; hence the law of 
primogenitor, I he custom of adoption under certein laws, and 

the joint family eyitem, the object of all of which is that on 
the death of one of the snakes which guard a tress tire another 
snake should be placed oyer It, and if by ill luck the snake 
leave, no issoe. one should be obtained from somewhere else 
so that the concentration of wealth is DO t disturbed 1 

These are the caneee which hare created the problem for 
humauity „ w b0 w means or living may be mede accessible to 
every Individual living oo God's earth, end how opportunities 
may bo provided to every one to advance in life according to 
bis capacity and to develop bis personality to (he full 
The Sen Horn SeggtitH by CeeioueJn 
Oim method of solving the problem has been suggested by 
Communism and it is ibis : that the means of production should 
be taken out of the bands of iadividuals and trensferred 10 the 
community for collective possession and that the community 
should alio coUexhvcly undertake the distribution of wealth to 
every individual each accord, D g to hrs needs. Ft lma f„ U |U| appear, to be very sensible, but the -ore one 
its practical nape ot the more will one realise hi defects until 
one will have to coocodetuat. in the ultimate analysis, iu 

offered. It » as clear as daylight that although, theoretically 
■peeking, the erfasgemenii for the utilisation of the means of 



production and distribution of products are pjoposcd to be 
entrusted to the 'hole community, in practice the task will, of 
necessity, bav« to be handed over to a small executive body. 
Even though tbis. small body may, to start with, be elected by 
the community, liter oo when all the means of livelihood come 
into its hold and individuals are not able to secure their share 
MC=pt through its hands, the whole community will be left 
helpless in its grip. Nobody will be able to ignore its «j|] and 
no organised pjwer could rise in opposition to it and be able 
to remove it from it. place of authority. IT this body dislikes 
any one it will mean itat the poor fellow will be deprived of 
all the raeaos of living in the land, si act alt the means of 

livelihood will be in the bands of this small clique, Labour 
will be left without power to strike work, if it baa a grievance 
against iba management, for, under this system there will not 
be many factory -owners and capitalists to enable the labourer 
to resign from one place and lake up employment with another 
lather in the whole country there will be only one factory- 
owner, only one capitalist, who will be the ruler of the country 
as wall, and it will not be possible even to aecure against him 
the help of any public opinion. Thii state of affairs will 
therefore have the following results ; that after abolishing 
all the capitalists and after doing away with all the industrialist! 
and landholders, one big capitalist, industrialist and landholder 
rolled into one giant, will be imposed on the people, and be 
will combine in himself the autocracy of a Czar with the 
absolutism of a Caesar. 

In the first place such an absolute and all-pervading 
authority is so intoxicating io its nature that it is extremely 
difficult for any man to restrain himself from becoming a 
tyrant and autocrat, particularly so when he does not believe 
in God and io his accountability to Him. Nevertheless, even 
if it is a-snmed that this small body, on obtaining vaat 
autocratic powera, will not overstep proper bounds and will 
woik with justice and fairness, even then under such a system 
there can be no opportunity for individuals to develop their 



personality. What human personality needs above everything 
else Tor its evolution and advancement is that ii should have 
freedom, it should have some means at its disposal which it 
may use in accordance with its own discretion and its own will 
aod choice nod in so doing develop its hidden potentialities. 
But in the Communist system there ii no possibility of this. 
Under this system all the means pass out of the hands of the 
individuals into those of the executive body of ihc community. 
This executive body utilises them according to its own concep- 
tion of the Interests of the community. The individuals have 
no alternative but to work according to the plans made by the 
executive body if ihey desire to take advantage oi those means; 
indeed they have to surrender themselves body and soul to their 
admraiitrntora to be moulded for tui F c*ti cf communal 
welfare accordingly to the plans of their masters. Thus ill 

the individuals in a society become practically slaves or a few 
individuals, u if they ware all soull»s, raw materials to be 
shaped and moulded to their desires and plans exactly as 
«baped to SUil the needs of a craftsman. Quite obviously 
human civilization and culture to lose a great deal umler this 
arrangement. Evan if it is presumed fcr argument's sake that 
the necessities of life will be distributed with fairness and 
justice under such a system, its advantages will be outweighed 
by the defects and deficiencies of the syHrm. The development 
of culture and civilization depends wholly on this ; that 
diff«rent people who are endowed with diverse faculties should 
have the opportunity IO develop themselves and play their 
individual part in the combined communal life. But this cannot 
be secured through a system wherein wholesale planning of 
human beings is undertaken. A few individuals, however cap- 
able and well-intentioned, cannot be so omniscient as to be able 
to assess correctly the inherent aod inborn faculties of millions 
of people and their i.atu.jl inclinations and also be able to 
determine correctly the mode of their development. Tbcy will 
eer bath in estimating individual capabilities and in forming 
opiaioni about what really commutes ibe trve interest of their 


society. Bat, ia spite of it, they will try to enforce their plans 
end mould according to their blue-prints the whole mas* of 
people under iheir influence- This individual diversity and 
the variety so neceSaary for civilization will give place to a 
soulless uniformity. The natural evolution of civilization wilt 
suffer a set-back and an artificial and spurious growth will 
commence. Human faculties will begin to shrivel and ultima- 
tely a great meocal ar>d moral degeneration will ensue. After 
all men are oat like grail and vegetation to be pruned by a 
gardener and made to grow after a set pattern. Every man 
bis his own personality with a natural urge to develop 
according to its inclinations. If yon deny him this frced6m he 
will not develop according as you desire but will eitber rebel 
against yon or fade away in unnatural gloom, 

The fundamental mistake or Commnnism lies In the fact 
that it treats the- economic problem as the central problem and 
then tries to revolve the whole of human life round this axis. 
It lacks the true scientific attitude towards human problems. 
On the other hied, it looks at at! problems with a deep econo- 
mic bias. Metaphysics, history/ sociology, in fine, everything 
within its sphere is Influenced and overridden by the economic 
view-point and because of this ooe-sidedoeta the whole balance 
of life is upset. Thus it is cltar that in reality the Communist 
theory presents no cot r*ct or natural solution of the economic 
problems of man. U oftVri a solution which is both unnatural 
and artificial. 

The Fascist Sola t Ian 

As against this, another solution haa been put forward by 
Fascism and National-Socialism which is as follows: That 
while individnal ownership of the means of production may be 
kept intact, inch ownership should, in the interests of the com- 
munity, be planned and controlled by me state, la practice, 
however, the results of this appear to he no way different from 
those of the Communist theory. Like Commnnism tbto theory 
also seek* to merge the individual in the community and leaves 
no opportunity for the free development of bis personality. 

B«idM this, the nature of the state which exercises control over 
Individual owtmhip i» a. totalitarian and authoritarian as that 
of iho Communist stntn. It require! a very strong sad concen- 
'rited authority to keep the iadmtry of ■ large country under 
control and, compel it to work according to tbe plans and blue- 
prlnti made by tbe lUle. In a state which has auch absolute 
coercive power Id ita bauds It it Inevitable that the population 
uf Ibe country will prostrate before it helplessly and become tht 
staves of tbe roles. 

Tbe blank Solutlei 

I 'ball now explain how Islam seeks to solve this problem. 
In dealing with all problems of We, it ii a fundamental 
point with Islam that natural laws and principles of We inherent 
in human nature should not be tampered with, and chat when- 
ever there ia any refraction from the path of nature it should 
be redirected to tbe natural path. The tecood important prln- 
clptc on which Islam has based all iti social reforms is (his i 
ttrnt the introduction of a few external reflations in tbe social 
syitcm should not be coniidered sufficient ; on tbe other band, 
■ far greater stress should be laid on moral reformation and the 
creation of too rig bt moral attitude anions " "bat the evil 
jn the mind of moo should be suppressed as its root. The third 
banc principle which you can trace in the whole of the Islamic 
system la thai the authority and pressure of law and the coercive 
power of aovernoaenc should not be used except when it becomes 
inevitable to do so. 

Keeping Id view tfiese principles, Islam recogni2ei alt those 
natural triple, on the economic side p. life which have 
always formed tbe foundation of human economy, and it 
abolishes only those wrong principles, not by reliance on the 
state but through the maximum of moral instruction and a 
small measure of external force, which mankind follows when it 
fails a victim to Satanic desires. Tbe principle that man should 
be free to strive for its livelihood that be should retain the 
right of ownership over whatever be earns by his labour, and 
[bat disparity must exist between various men due to their 


bconouk; systbm of hum 

varying abilities and circumstances has been conceded by Islam 
to the extent to which it is in accordance with nature. It then 
seek i to qualify this principle and Introduce certain restrictions 
oa iti actual practice with the object that it may not he misused 
and made a means of exploiting and oppressing the weaker 
sections of the society. 

. Let os flrat of nil take the acquisition of wealth. Islam reco- 
gnizes the right of maa (o seek the means of his livelihood on 
God's earth according to his capacity, ability, and natural 
endowments. But it does not concede him the right to adopt 
such means in the acquisition of wealth as woeld lead lo his 
moral degradation or upset the social order. Islam sett up the 
d is tine I ion of Mai (lawful) and haram (unlawful) ia respect of 
the different means of earning and imposes the baa of illegality 
on all those methods which are morally injurious. For this pur- 
pose it has clearly speeded those methods which it regards a« 
injurious. Under the Mamie tew wine and other intoxicants 
and drinks which spread evil and immorality are not only un- 
lawful {ha'am) in themselves ; e*en their manufacture, tale, 
purchase, and possession have been declared to be on I awful 
Islam does not recognize adultery, music, dancing, and other 
similar things as lawful means of livelihood. It declares all 
such dealings as unlawful in which the gain of one individual 
is secured by the loss and injury of some other persons or of 
society as a whole. Bribery, stealing, gambling, speculation, 
business based on fraud and deceit, boarding and holding back 
the necessaries of life with the object of raising the prices, mon- 
opoly of the m=ans of production by on: or several persons 
which narrows The field for others ; all these methods have been 
declared unlawful. It his picked out carefully snd branded as 
illegal all such forms of business as arc by their nature capable 
of causing litgation, or in whkh the lo»s or gain depends on 
mere luck or accident, or wherein the mutual rights of the 
parties are not distinguishable. If you Study in detail th* 
Islamic laws of trade and industry you will see that the method* 
by which people become millionaires and multimillionaires in 


modem time are mostly methods on which Mam hat placed 
Mr*** .legal restrictions. If business i, carried on within 
these Islam* limitations there would b« little chance for any- 
one to accumulate immense wealth. 

White Islam recognizes the rigbl of the individual to the 
possession of all that be may acquire by lawful means, it doea 
not leave him entirely free id the wealth So acquired. On 
the other hand k lay, down restrictions on ita me la different 
way.. It la obvious that there can be only three possible u ,„ 
of the wealth which a mut acquire,. It can either be spent or 
invested to procure more wealth or may be hoarded. 1 shall 
explain her. briefly the nature of restrictions which Islam ha* 
placed on each one of these use,. 

All Mhod, of speodiag which cause moral or .ocial 
.□jury nra forbidden. You canoot fritter away yom wealth in 
gambling, yoo caooat drink wine, you cannot commit adultery, 
yuu cannot waste ,ou r money in music and dances or other 
mean.ofwlf-lndulgence. Yon are forbidden to wear stlkan 
dresses ; you are prohibited (except io tbe case of women) from 
..sing golden ora-menu and jewel. ; , n d you caooot decorate 
your house with picture, and statues. In short, 1,1am ha. 

closed all tho« outlet, .broagh which the greater portion of. 
man wealth .. .pent on hi. own .usuries and indulgence,. 
The items of expenditure which cocsldeis lawful are of such a 
type thai a man may jast be able to live a decent life of a p 
•varage Standard, and if any Surp!us 1, then left over. Islam 
suggests that it should be utilized in .he service of virtue aoU 

persons who have been unable to secure and receive th cir share 
■Kordsng to iliaj, „ed». According to Islam the best course' 

1°J °" Sh ° Uld ipCOd " lI lbal bc *™ « l^rut 

and readable need., and if any surplus accrues, hand it over 

o other, so that they may satisfy their n«ds. Islam regards 
tb.s quality as one of the highest staoderd, of morality and has 
put |( forward as an ideal with such force that a society 
influenced by Islamic ethics will always respect thoae who earn 



■ad spend, macb more than thou who keep their wealth hoard- 
ed or who go on investing their surplus incomes in earning 
more. However, in spite of all titis moral education and the 
exercise of moral pressure by a reformed society, it h not pos- 
sible to gee rid of individual tendencies towards greed and 
avarice. A good many persons will always remaia who will 
like to invest their surplus wealth in earning further wealth 
over and above their needs. For this purpose Islam has placed 
some legal limitations on the use to which this surplus wealth 
can be put. It is strictly prohibited in Islamic law to lend 
these accumulated savings on interest. If you tend your money 
to any one It does not matter whether he borrows for his 
private needs or for business purposes, yon are entitled to the 
return of the principal only, but note pie more. In this way 
Islam breaks the very back-bone of aggressive capitalism and 
blunts the edge of the greatest instrument by means of which 
the capitalist tries to concentrate in his hands the economic 
resources of the community by relying on his money power. 
ASJCgsrds the method of oiiog the surplus wealth investment 
iu one's owa trade, industry , or business or providing capital 
to others and participating in the gains and losses of tbt> joint 
undertaking. Islam considers it quite lawful and proper but 
seeks by other means to remedy the evils which flow from the 
.accumulation of wealth in the hands of a few per'oas. First of 
all, Islam does not permit the hoarding of this accumulated 
wealth. Ai I have just mentioned. It demands that whatever 
wealth you have must either be utilized in the purchase of yoor 
own necessities or handed over to others so that they may 
satisfy their needs, and thus the whole of the common wealth 
may be kept constantly in circulation. But If you do not do 
so and. insist on its accumulation, then two and a half per cent 
per annum will be taken out of thb accumulation by force of 
law and spent on giving assistance to such persons as are not 
fit to lake part In the economic straggle or *ave sot in spite of 
their struggle been able to secure their fall share- This is called 
H £*kat" and the administrative machinery proposed by Islam 1 

tot thj, taxation i. the joint exchequer of t be community in 
which «<Zakai" is collect and thee redir* ibnted amoog thU 
wctions of the community which need »nd deserve-nelo This 
la in feet the best for* of i-wuc* for the society and destroys 
eU the evil, which aril, from the absence of any regular 
arrangement for collective help and cooperation. Whet really 
force* * men. so the capitalistic system, 10 accumulate wealth 
end invest it in profitable business eed briog into exigence 
.attituiions like the life insurance, it thdt under this system 
■very one's life is wholly dependant on hit owe mceei. If one 
has not laid by anything for his old age one may fece starvation 
in hi* old age ; If he dies without leaving any inheritance for 
bis progeny, they will be driven from door to door without 
being able to eecure a bit of bread ; if he f*Ui lick and hu 
nothing in store he may not be able even to secure mcdicsf 
treatment for himself ; his house it burnt or he sustains ]ot» in 
buiine,, or some other sudden calamity befalls him he cannot 
find «ay support anywhere. Similarly # hit force* the labouring 
cluaes coder a capitalistic system to accept any terms of 
roptoynKntoCere* by the capitalist sad become hit Haves is 
this very tbiaig : U., tbe fear that if the labourer doc. oat 
accept the remuneration which the capitalist is prepared to 
offer foe his toil and sweat, destitution will it are him in the face 
and he will not be able to hold off nervation for a single day. 
Moreover, it is only due to this system that the spectacle is 
witnessed tbe greatest curie that has afflicted the world by tbe 
grace' of this capitalistic lytteo-that while on one side 
millions of hungry mouths are to be fed, on the other side there 
are large stock of agricultural produce and manufactured 
articles which cannot And any market, with the result that lakhs 
of tons of grain is thrown into tbe sea Instead of feeding the 
hungry. The reason for this also ties in the fact that no social 
arrangement exists for providing means of livelihood to the 
oeedy and (be destitute. If these people are provided with 
purchasing power and enabled to bur commodities according- to 
their needs, trade, Industry and agriculture. In short every 



branch of economic activity will expand and flourish. Islam 
roots out «ll these evils through the institution of "Zakat" and 
the agency of the public exchequer for iti collection ud di&tH- 
bntion. The public exchequer is always available to yon as a 
heW. Yon need not take thought for the morrow. Whenever 
you ■« In need you can go to the public exchequer and obtain 
your rightful duo. There b no necessity of keeping depo,". " 
bank! and or havmg inaoranee policies. You can leave this 
world w.thout any anxiety for the future of your children the 
exchequer of the community will be responsible for them after- 
wards. It ii a constant and permanent helper to which yon can 

*ir?M BC T' 10 * diS ""' ° ,d ** c ' «i»»Uicdueto 

earthly or heavenly c a u ,«, and ander any other similar clrcum- 

V? DCC *- J* capltalial cannot then compel >on to accept a 

„.Th ?t T??™- Tb " e U 00 of 
^^"^""^^o/ibclierforyou in the presence 

of the puWfc exchequer Tbeo again, it should be noted that 
tb.^cfal agency enable...], those sections of the population 
who cannot ern or who earn much fen than they require, to 
purchase commodities necessary for (heir life Thus a nmn^r 
balance bet-cn production and consumption is permanency 
m.inta.ned and the nec**j t y doe, „. , rile for a p 7 0 p U i0 * 
on .mposing their bankrupt npon other peoples and after 

exhauifng .1! victim, in this world to seek them in the othlr 

for XS^JtZ "^L" U ° lhef P ' aD WhiGh ,Slfl * b » *<0pted 

[nherlfanr^ Al1*"tfc , C ~^ in one place i S ltS law of 
inbemance. All other law,, except that D f r sUm Ieod l0 

^IrtlV^Tr™* 00 , ° fW< "» bev " after the death of 
tbc person who had accumulated it ^ liag hi$ Jlfcl3m( , l%](Lm 

on the contrary, adopt, the method that the wealth whTch a 
l^rson baa been cononlDg in hi* hands by gradual accumulation 
irom all sides should be distributed iia:^a: ( !« on his death 
Under the Islamic Jaw sons, daughter,, raiber, mother, wife, 
bro.bera, s.slers, aji suczeed to a person's j=b-rit anC e which 
must be appointed among all of the* according to a regular 


code. If near reasons do not . search will have to be 

made for distant 0D « and this wealth be distributed among 
(horn. If ao relative. «ar or dialler, i* forthcoming even (he* 

In that «v« the whole untouulty ..II succeed him . nd to a „ 

h,a ^cumulated wealth will bo deposit in ,be public ex- 

chequer. Ia this manner even if « mBn may concentrate 

millions and billion of money it will all be dispersed after hit 

death (a, mall prions within two or three generation*, and 

cv e ry.u C h ac«io,ul.ti 00 wiUbet U raed gradually Jaio circula- 
tion according to a regular legal procedure. 

Consider this economic system of which I have presented a 
brief plan to you. Does it not remove all those evil* of indivi- 

A U 'l ,T^ iP " h . iC,, relU!l ff0m Wf0 °« Of ^ 

davtl 7 There remains no necessity at all for adopting the 
CommuDlit or Faaciit or HatioeaLSocialist ideologies, and 
^mgthote artificial methods of ecoQomlo manegrmerjf which 
do not remove the evil but replace it with another. I hovo not 
here eiplai-ed the complete economic aystetn of Islam, ft la 
difficult t« explain within the compass of tfaii brief discourse, 
alt the methods that can be adopted in accordance with the 
Islamic principle* for the management of lead, the set tie meat of 
trad* disputes, and the raising of capital for all of which com- 
plete provitioa-has been made In the Islamic law. I nave Dot 
even been able to mention how Islam has. by removing all tariff 
restrictions levied on esports and imports, and by abolishing 
octrois. ces«* and tolls on the movement of commodities 
opened the door absolutely far free trade. Nor have J had (he 
opportunity of mentioning that by reducing to the minimum 
possible extent the expenditure oo the administrative machinery, ' 
on the civil servitei and the army, and by abolishing altogether 
the stamp duty on judicial proceeding, Islam has lightened n 
very great economic burdeo from society, and provided op- 
portunities far spending the taxes for the good vt *o<i«iy 
instead of allowing them to be absorbed in the unbounded 
expenses of the administration. By this means the economic 


system of Islam becomes a great blessing for humanity. Studied 
with an uoblascd mind free from those prejudice* against 
Islam which hive been Inherited u an evil legacy from past 
history end nnawed by the blaze of modern social aystem, I 
hope and trust that this Islamic system will satisfy every 
reasonable and truth-seeking person as the most useful, correct 
and rational one for the economic welfare of humanity. But if 
anyone thinks it feasible that this economic system can be 
successfully implemented even if divorced from the complete 
whole of the ideological, moral and cultural system of Islam, 
X will humbly request him to get rid of this misunderstanding. 
This economic system has a deep relationship with the political, 
judicial, cultural and social syitam or Islam, And all these 
branches are fundamentally based on (he moral system of 
Islam. Then again this moral eystera does not stand by iuelf 
but is wholly dependent 00 your belief in an All-Powerful and 
All-Knowing Qod and your sens* of responsibility to Him, in 

the cooception or an after-life when all your actions will be 
judged by Ood, in the belief that man will be punished or 

rewarded according to His Judgement ; and in the acceptance 
of the fact that the code of law and morality which Muhammsd 
(peace be upon bim). the Messenger of Qod, has placed before 
you as from Qod (of which this economic system Is only a pan) 
i« really based on Divine guidance in all its details. If you do 
not accept this creed, this moral system and the whole of this 
code of life completely as it is, the economic system oflilam, 
divorced from its source, cannot be maintained or administered 
in its purity even for a single day, nor will any appreciable 
adviDUge accrue from it if you take it oat of its w ider context 
sad then seek to apply it to your life. 

Economic Precepts 
of the Quran 

1- Bute Facts 

One basic fad regarding Social Econom* upon *hich (he 

^r QU ^ rCP T d,V ^ f$ lUt » U «- «d 

27 tbf ° U8h ^ cb ~-««oshi S livrlib 0 c d af C Divinely 

f«m I, .iH AIJah Cr " led (b0W! feJ0UrCCB 

orm^doo.wbDa.uralptiwipktch.t they land thcm*elv« 
lo human u.o ; a»d it r» He alone Who afforded maa thr opnorr- 

S^-!* frora ,hcm " d firanTed bm Ihe to 

"ft h He Who h„ raadeth. Earth m.nageable for you. 

which h^t ye * reu * h * lrM,i - ADd «** s «"«"« 

whtcb He runmhes. Aod unto Him is the Rejection." 

(Al-Mulk: t3) 

"And it « He Who spread the Earth and »t (be mountains 
oa.t, cawed the rivers to flow io it and created two varictie. 
** every aped* of fruit." (Ar-Raad : 3) 

Parti! 11 '* HC Wb ° ° r " ,Cd '° r y0U cve^ > ,Ihi,, ^ *»« '» in ihe 

(Al-Baqareb : 29) 

"' l * AH.b Who created Heaven, and Earth and poured 
water from the sky and through this means created fruit* for 
your suateoaace ; aod gave you control ovej the boat which 
-ail. in (be saa by Hi. leave ; and gave you cnauol Over the 
rivers; and set the sun and the moon on a regular counc for your 
sake so that Ihey constantly move Bround their orbit ; and sub* 



jected the night and day to a fixed law for your sake ; and gave 
you, everything that you asked for.* Should you count the 
blessings of Allah, you could never number them all," 

[Ibrahim i 32-34) 

"We gave you authority ia the earth aud provided resource* 
in it for yoor livelihood". <A1-A , r«f : 10) 

"Do you ever reflect ; Arc the crops which you sow raised 
by ynu or it is We Who raiie them". [Al-WSqi'ah : 63-641- 

2. Determination of Right and Wrong is the Prerogative of 

It is on the bsjra or this Truth that the Holy Quran enun- 
ciates the rule that raaa has neither the right to unrestricted 
possession and use of the economic means. Dor is he authorised 
to frame legislation determining the right and wrong in this 
matter. It is the Prerogative of Allah to make the law for the 
ownership and exploitation of economic means. The Quran 
castigates an ancient nation of Arabia, the Medians, because 
tbey believed io the unbridled right of a man to earn and 
expend wealth. 

They said : "Oh Shu'aib! Does thy (religion of) prayer 
command tbee that we leave or? the worship which our fathers 
practised, or that we leave off domg what we like with our pro- 
perty V (HQd : 87) 

The Holy Quran declares it "Foul" that man shou'd him- 
aelf determine what is right and what is wrong. 

"And do not issue false decrees that this is right and that 
is wrong."" (An-Nahl : 116) 

* That ti. cvcryihina you neeJe d and your situation required trt«sr>* 
eetive of wbcihcr you solicited Unite >~\ir tongue or not." 

[Biidawi, Anwarul-Tanzil, Vol. J. p. 161 ; Mustafa al-BaW E*jpr: 

[1330 H/1912 A.DJ 

••"This ayah vehemently forbids that people should decide what if 
right tad what ii wrong according to their own views aod desires." 

(Baidawi Vol. 3, p. 193). 

"The mbstaoct of this ayal is. is Askari puts it, that if Allah's and 
Hi* Prophet's order regarding the, right or wrong of a matter does dot reach 


-Aiufc.Mu , r4de „ wrul <od iolerMt u ^2» = m. 

(Ya-SlB ; 71) 

>° u » yo» OdOltf not dciennJQ. it- rlA( „„ .1 _ 

b« no oil*, fb-cf.,^ n^J^T^^ fDr lh< « wron, 


fcxMOmc ntrtu op islam 

"As for the tbier both male and female, cut off their hand*. 
An exemplary punishment from Allah. Allah is Mighty, Wise," 

(Al-Maidah : 3$) 

"And pay the due thereof upoo the harvest day. "d be 
not prodigal/' (Al-An'to s 141) 

"Exact alma of their wealth.-' (At-Taubn : 103) 

"Give unto orphan* their wealth nor absorb their 

wealth Into your own wealth." (An-Niw : 2) 

"Unto you are lawful all beyond those mentioned, so that 
ye seek them with your wealth in honest wedlock not debau- 
tfctry « (An-Niaa : 24) . 

"And give unto the women [whom ye marry) willingly 
their marriage portions." (An-Ntai : 4) 

"And if ye wish to exchange one wire for another and yt 
have given unto one of them a «um or money {however great), 
take nothing from it." (An-Nta ; 23) 

"The likeness of those who spend their wealth in All***' 
way is as the likeness of a grain which groweth urn ears, in 
every ear a hundred grains." (Al-Bsiqaxsm : 261) 

"Voo should strive for the cause or Allah with yotu wealth 
•ad your lives." (A*Iaf: 11) 

"And in their wealth the beggar and the outcast had due 
ihaie." (Adh. Dhariat : 19) 

"All orders and injunctions reproduced above pmuppoae 
the existence of private property. The Holy Quran essentially 
presents a system of economy which in all its aspects is bnllt on 
the proprietary right of individuals. It -does not contain even 
a faint trace or the concept which sets up distinction between 
consumer goods and means of production and limits individual 
ownership to the former while assigning the latter exclusively to 

public control. 

Likewise no distinction between earned income and an* 
earned Income is apparent in the Islamic doctrine. For example, 
it is clear that the inheritance gained by a person from hi* 
parents, lasne, wire, husband or brother and sister does not fall 
under the head of earned income, nor is Zakat the earned in- 



come of the beneficiary. Moreover, iu this economic scheme 
there is do notion of an interim stage, leading to tome final 
goal where private property shall five place to complete nation- 
alization. Had this been the real object of the Quran it would 
have explained u in unambiguous terms and would have 
provided laws and injunctions on the subject . The fact that at 
one place the Quran states : 

"The earth belongs to Allah" (AI-A'iaf ; 126) 

is not sufficient ground for the theory that the Quran 
abolishes private ownership of Und and sanctions its nationaliza- 
tion. The Holy Quran alio states ; 

"All that is In the sky and io the earth belongs to Allah'*. 

(Al-Baqarah : 284) 

It cannot be inferred fiom this that individuals are debarred 
from owning anything on Iba land or in the sky, nor can 
it be deduced from the text that all things ia the earth and sky 
should be national property. If the Divine ownership excludes 
human ownership then it abcli*hei (be right of both individuals 
and nations to own aojtbicg. Similarly it it incorrect to argue 
fromayatlO of Ha Mien As-Snjda that "the Quran cov| MgcS 
equal distribution of the earths' resources of fond among human 
beings and ibii equality cannot be established without nation- 
alization of these resources. Hence the intention of the Quran 
is io enforce socialism." 

Supposing we accept the interpretation of the ayat as 
"Allah placed ia proportion in four days the resources of food 
in the earth, for all the needy, io equal measure."* Even 
then it would be wrong to think that 'needy* refers only to 

■ This ii not sn accurate iranilalioo lo itself. The Jal wotds are : 

^Ut-U Jj- f UJ ^,1 J Zaftkahibri.BsiJawl, RS Z ,\ Alviai and other 
cornmeatafon take tbc word".' W* la be ccooetled with - .Ll" «i« 

to b« connected »itb *'^|" and aJve 
ibis interpretation "Allah did ibis work ia lull four days '. ' 

Tin caajmanutof* *ho *oid that a1*~ fa related to ct-LjL_U uod*y- 
irind it to nwan "Provided for ail the needy" or "Accordina to ihe 
demand of all the n«dy '. For fuitaer explanation tela to Tafbim-ul- 
Quran, Vol. 4, commentary on jura Ha Mim aa-Sajd. footed* »2. 


Economic nsrvu or ituot 

human beings. The needy necessarily includes besides human 
beings, all other kinds or living creatures tlso, whose resource! 
of food have been placed by Allah in this same earth. If 
according to this ayah the share of all the 'needy' ones is equal, 
then there is no ground for confining the right of equality to 
the human species alone. Similarly, it cannot be argued from 
those ayahs of the Quran which siren the need for provision 
of food to the poor classes of sociaiy that the Quran intends 
to establish a socialist order to achieve this purpose. Wherever 
the Quran mentions this need, it essentially lays down just one 
scheme for Mailing ft, which is. that members of the affluent 
class should liberally spend their wealth on their poor relations, 
the orphans, and the destitute and other deprived or indigent 
people m the society with the sole object of winning the favour 
of Allah. In addition to this the state also is charged with 
the duly of collecting a fixed portion of the wealth of affluent 
members of the society and spending it on the 6oancially 
depressed citizens. Apart from this practical scheme, there 
is absolutely no trace of any other plan for achieving (his 
purpose in the Quran. There is so doubt that no injunction 
of the Quran obstructs the nationalization of a particular 
sector of the economy whenever the need for such an action 
arises. But a total ban on private property and Che adaption 
of socialism as a doctrine and system of life is inconsistent 
with the economic scheme of the Quran. Moreover according 
to the political system envisaged by Quran do single party or 
group has the authority to decide that a sector of economy 
should be transferred ftoa private to public control. Tile 
decision for such a move lies with a consultative body whose 
members have been elected by a free vote of the people.* 

4. The Un-aa(ural Doctrine of Economic Equality. 

The fact that like other natural .things there ia no equality 
among humao beings as regards i J he provision of food and other 
means of livelihood is presented by the Quran as just another 


ajpcct of the Divine Order. Leaving aside ihe artificial 
disparities established by various sociat systems, so far as the 
natural inequality 1% coocerncd, the Quran regards k as the 
result of Divine Will sad Diipensattbo and there is no evidence 
» the entire scheme of the Quran that it intend* l0 eliminate 
natural inequality and establish ao order wherein everyone 
should receive an equal share of the ecooomic means. 

"He it is Who hath placed you as viceroys of the earth and 
haih exalted seme of you in rank above others, (hat He mjzht 
try you by that which He huh given you." 

(AJ-Aa'lm : 165) 

"See how We prefer one above another, and verily 
Ihe Hereafter will be greater in decrees a „d prater in 

pr " crraeat - - (Baailirail: 2|) 

"tl it they who apportion thy Lord's mercy ? We havn 
apportioned among. »h«m their livelihood in worldly life. And 
raised some of them above others iq rank that some of them 
may uk. labour rrom others ; and the mercy of thy Lord is 
better than (the wealth) that they .mass - (Al-Zukhmr : 32) 

"Lo" thy Lord enlargeth the provision for whom He will 
and itrtltenetb (it for whom He will). Lo, He was ever Knower, 
SeerofH.ssl.vei" (flani Israel : 30) 

"Hii are the keys of the heavens and earth. He enlarged 
providence for whom He will and sttaitemb (it for whom He 
will) Lo, He is knower of all thing..- (Al-Shura : 12) 

... : Lo ' ^ Lord « ( «gcth the provmoo for whom He 
will of His bondman and narroweth (it) for him." 

(Al-Saba : 39) 

Thi. tit* been stiud in the context of an objection by .be 
Hdy Prophafi enemies (hat bad All .b ™bed «o ra,* . Ptopb^ H* 

what possible icaton could He have for appoiniicjt Muhammad (neace be 
en bio) as Ha apostle ? 


economic system or BLAM 

The Holy Quran enjoin* that mankind should calmly 
accept this natural inequality sod none should envy the advan- 
tage granted to another by Allah. 

"Aid covet not the thins in which Allah bath made tome 
of you excel others. Unto men it a fortune from that which 
they have earned and onto women a fortune from that which 
they have earned. Ask Allah of his bounty. Lo. Allah it evar 
Knower of all things". (An-Nisa : 32) 

The two ayahs From which a section of people are trying 
to derive the conclusion that the Quran wants absolute 
economic equality among human beings are is follows : 

"And Allah hath favoured iom e of you above others in 
provision. Now those who are more favoured will by no 
means band over their provision lo those (slaves) whom their 
right hands possess, so that they may be equal with them in 
respect thereof. Is it tbeo the grace of Allah that tbey deny ? M . 

(An-Nahl : 71) 

"He coioeth for you a similitude of yourselves. Have ye r 
from amooa Those whom your right hands posses*, partner* in 
the wealth W c have bostowed upon you, equal with you thereof, 
so that ye fear them as ye fear each other (That ye ascribe 
unto Us partners out of that which We created ?). Thai We 
display the revelations for people who have sense' 4 . 

(Ar-Roum : 28) 

But the words of these two ayahs clearly show, and the 
context in which they have been revealed also makes it plain 
that herein in fact no exhortation has been made to eradicate 
economic inequality as a foul thing and establish in Us stead 
a system of economic egalitaritnism. On the other hand these 
ayahs present the fact of economic inequality among human 
beings as an argument against FoJytbelsro, which is that since 
you are not prepared to admit your slaves as equal sharers of 

your wealth, how preposterous is your notion that any of His 

KowoMrc necEPTi or ran qckan 43 
crcatjrci can abare in His Divioity ?• 

Allan S« created Hn bouulie. io the world with (he iole 

the w,ltof Allah, anr c,n u be. that m , a Jh0llld , bf 
?' boaa,icl '"fo Io mcBlieiim. Whet He actually 

end Bv.l the uolewrul practice. . nd tbo,. tb.t .« Idwful . 

o? law, T'"' 1 "a? * h ° U " ) te Cnn6 « d " ,he c " e «^ 
of towM end pure to Btt and e«n .a ,hi. th e Bound. OI 

moderation ihoutd act be encecdcd : 

"He is Who created far yo« all that i. in the Earth". 


H. JE/ v° ^0t '" <, * :,, •<•»»«« <* Allah which 

you have put your faith". {AI-MalJah . Ml 

•■OM., l i„d.E.ff,ha, which i, l.wfj^th 
» he world and follow no. io the foot.tep, of the devil. To 
h. b open eneray for you". (Al-B.a.rau : , 6 8 J 

not ,h,„n?\," a ' 1 " ,,k • bU< "* 001 P™ 0 "'*" 1 - L ». He lovelh 
not be prodigal, . (Al-A'raaf : 31) 

But monuticism tb.y invented. We ordained it not for then, 
jrlght observance . (Al-H.deed : 27, 

* Tbfi point become, perfectly clwr >f Mr rfladine M^lVT^ZT 


» detailed «*^.Z- ! J" a a,!, " T "' 1 '™* ofAii.h> uoi , y . Ffl 



6. Distinction Between Lawful and U»U«f«l Means of EaroiD.2 

The Holy Qurao lays down the rule that wealth should be 
obtained through lawful means only and unlawful means should 

be avoided. 

* O ye who before ! Squander not your wealth among 
youtselves in vanuy. except it be a trade* by mutual 
cOokdi. And kill not one another. Lo ! Allah is ever Merciful 
unto yon." (An-Ni$a:29) 

Unlawful Means of Shearing Wealth. 

A detailed description of the unlawful' means of obtaining 
wealth has been given by the Holy Prophet (peace be upon him) 
in the traditions and by the jurists in the books oo Islamic Law. 
Some of these mean* whLh have been specified In the Quran 
are as follows :— 

"And eat not up your property among yourselves in vanity, 
not seek by it to gain the hearing of the judges that ye may 
knowingly devour i portion of the property of others wrong- 
fully."* (Al-Baqurah : I8fi) 

"And if one of you entrustetb io another, let him who is 
Trusted deliver up that which is entrusted to him (according to 
ihe pact between them) and let him observe his duty to Allah 
his Lord." (Al-Baqarah : 283) 

* The term ^radt" denote* exchange of gooda and *e*jces for money. 
(St* AJ-Jasm, Ahkair, ul-Qurao, Vol. TI. p. 210-Matbaat al-Hahia. Egypt 
1M7 H. lec-al-Arabi, AbVamuMJuran. Vol. 1, p. 170. Matbaai-al-Sa'ada. 

Egypt 1JJT H. Tbe condiuco of mutual agreement iueif icopliei thai 
"chaujc ibojld cot take place under any form of durcaa, nor should ii 
iovotve fnud Or pretcsc: Which if It were known io the ether party would 
doi secure its agreement. 

• The phra«e "To Riin tbe bearing of the judges" inipltea atartiog ■ 
UK-suit wrongfully the property of another as well as corrupting 
the authority Id order to sals Iflcgat posaeaator. of anothex'i property. 

(Alwi. Rih-ul-Maaoi, Vol. 2. p. «). 



of rJ2S £ " bnQg hl9 deceit * llb hiro 00 «* day 

hath « * Wl5r * K " WiI1 * " 8 > d * f «" it 
.unearned. <AlMI«r«D ; WJ, 

"A'fcr (he Ihier, both male a„d female, cat off their haodi 

be lh.l ,hey will b. Wled or craciBed" , AI M " d l :«) 

'Sty do but >««l| ow fl re int0 ,j,« ir b,„ ieli .nd.heywNlbe 

MPM ' d 10 bUmi «« «— (Ao-Ni., : 10) 
"I. Wo« unto (he d.fraodeM : 

den^d Wl,B ' '*» — ™ -»«nd. 

lo. 2i' '!!Tr 0lOye <h " • 1 " d "' ho '"' »P«-d concern- 

SSS5L^£," waw " piiDful "-*-«'■ 

-ono »o Ine Hereafter. (An Nor . , 9) 

tLuqmaa ; 41 



it to robbe* « Bd 

M Tfi- . . , (AMtl«i. Vol. 2, p. 494), 

*« term DliHm* A f A „r* r 

Mm* tnd -i! Dllwr , 0fl I a( ™ d,,C[Wifi «* «y-h include* ,i D gi n| . 
Allah. (Ifto-j-J^r w " a ' ulAmcQ,i wb,cfc ■••«« from the *ty of 



"Force not your siave- 4 Hs to whoredom, if thev would ere- 
serve the* chastity, that yc may a«k orient of the world "I 

i . (An-Nur : 33} 

Aad come not near to adultery. Lo ! it is an abortion 
and an ev.l way." (Bud tall - 32) 

'The adulterer and the adm tere », scourge ye each one of 
them (witb a hundred nripes)".i (Al-Nar : 2) 

"0 ye who believe ! liquor, gambling. caiciog lots before 
idols or by discharging arrows or by dice, are foul devilish acts- 
avoid ihem."> (Al-Maidah : 90) 

"Allah pwmiuefa trading and forbiddelh usury. 4 

(Al-Baqarah : 275) 

I. The real objective of thle ayah j, to eliminate proiiitmicji " 
Stmve-ilrli are itpKiall' mentioned bacauc among ancient Ar.ha (he 
bmlneti of proniiunon depends entire!* on alave-womcc. Masters used 
(OieitbelryooDjaod dutiful tUve-a.rli in buala... M prostitute mail 
lived en their aarn.nji. (f t>0-i-J a r,r. Vol. If. pp. Si 58-1 CP). 104. 
Ta/*a»IA2ir». Vol. 3. P p . ds-zsi. Maibth Musta'a MoWnid' 

SX.^337 h: AWu ' Bar - v °'- 

2- Alongwitn forbidding adcltery aa a >io the income dan>«d from 
adnltery »ae aho declared unlawful by Iilara aod the Holy Prophet (nan 
and bitulnp of Allah be on turn, pronouned it „ Ule fou't„ ti^ rf," 

— Buhbari Boob 34. Chapter 113/aiao Book 37, Chapter 20/Bmjfc 6S 
Chapter 50/Book 7* Chaptar 4c7Book 77. Chapter 96/Mu«lim, Book 22 
HaditK Ho. 39—41. Abu Dawud, Book 22. Chapter 39— a. 

Tlroildhu Book 9. Chaplcr 37, Book 12. Chapter 46, Book 26 
Chapter 23, Nasai. Book 42. Chapter 5. Book 44, Chapter 00, ibn-c-M.j/ 
Book 12, Chapter 9). 

3. The manufacture and exchange of all th-nfi rorbiddep by the 
Ouran i'j unlawful, for prohibition impfiei that no benefit should be derived 
from tbem in in y wa*." (AJ-Jassas, Vol. 2. p. 212). 

4. Hut shorn thai in the case of a business deal, the profit earned by 
an individual on hit capital or in the case of joint atock company, the 
dividend received by a shareholder proportion to his Euvcilment a lawful 
But In the cue of . ! fll0 , anything in exce 5l of the principal amount' 
received by ibr. Tender free tfc e debtor i» unlawful, because uoKke the 
profit earned in trade. A|[ flh d« B cot hold it ai lawful dividend. 


O yc who beliflve I observe your duty to Allah, and giv« up 

what remainetb (due to yon) from tuury, if ye are <in truth) 
believers. And if ye do not, then be warned of war (against 
you) from A)Ub and His messenger. And irye repent, then yo 
have your principal (witboot interest). Wrong Dot, and ye 
stall not be wronged. And if (be debtor Is Jo straitened circum- 
stance*, then (let there be) postponement to (the time of) 
esse ; and that ye remit the debt as almsgiving would be better 
for you if ye did bat know. (Al-Buqarah : 278-280) 

Thug those means of gilnfog wealth which the Holy Quran 
declares unlawful are briefly as follows :— 

I. Talcing properi,- or goodi without the conic at of the 
owner and without payment, or taking with payment or with- 
out payment but with consent In such a manner that the content 
Is at cored under duress o 

Z Bribery. 

3. Forcible occupation. 

4. Rrnbf nlemeot of private or public wealth. 

5. Larceny and robbery. 

6. Expropriation of weilth belonging to an orphan. 

7. Spurious weights and measures. 

8. Business promoting licentiousness. 

9. Tbe vocation of siogiag and dancing. 

10. Prostitution and Income from adultery, 

11. Manufacture, sale end transportation of liquor. 

12. Gambling and all such practices in which wealth passes 
from one to another jut by lock or chance. 

13. Sculpture and sale of idols and services rendered lo 
temples of idol- worship. 

14. Fortune- telling and drawing lots. 

15. Usury, irrespective of low or high rate and regardlesa 
Of whether interest is charged ok loana advanced for 

SO kximowc nrm* or 

private use or for commercial, industrial or agricul- 
tural enterprise* 

8. PT©hiWrIo» of Avaxlee *a4 Hoarding of Wialtb. 

Alongwitb proscribing evil means of securing wealth the 
Holy Quran strongly disapproves of the hoarding of even law- 
fully earned wealth and teaches us that avarice is a great evil, 

I. Woe unto every slaoderioj traducer, 
II. Who bath gathered » tilth (of thit woitd) and layeth it 

HI. He thinketb (hit his wealth will reader him immortal 
IV. Nay, but verily he will be Sung to (be consuming o«.' 

{At-HumaMh : 1-4) 

'They who hoard up gold and silver aod speed it not la the 

«ccei^. WbM0 " U " d ft °" h|B "chare the 

3^ct -s. who ho. r d, p lba :»^^ 

rti.fe- Ji , Hil." -,f T.l? flnt fK,in "* , "' of w*h ibn ihta Ordinance 
fh V lb,t ' n UT dil1 lav °Wo, . l«o If .he cr*ii,« -IT? 

nlncipiJ ftRMUnt. MwiJIhf leutoflr. Svl rf l6f 

for nriVgiCfi nrrrf* Tl. * v *»HVU M Mr 14)0 UkCi 

Tutelen for the* arc luMcrt^ ,J ^ v ? L " ,urT ^'^ W'On iff 

Brownie pftBcam or TUB QUiAN 


9. Condemnation of Materialism and Greed. 

At the sametlme toe Holy Quran alto reveals that mater- 
ialism, greed and craze for worldly wealth and pride and 
haughtiness of riches lead me a astray and are among the chief 
causes of bit ultimate ruin. 

*M) Rivalry io worldly increase dlstracteth you. 
(II) Until ye come to the gravei. 

{Hi) Nay, but ye will come to koow l p * (At-Takathur ; I— J) 

"And how many a community have- we destroyed that waa 
tbaoltlesi for its meant of livelihood ! And yoqder are their 
dwelling* which have not been inhabited after them attve a 
little. And We ware the inheritor*.'* (Al-Qanas ; 58) 

M And We aent not unto any township a warner, but Jte 
pampered ones d tclared : Lo! we are disbeliever! io that 
wherewith ye hava been sent. And they say : we are more 
lihan you) io wealth sod children. Wa are oot the punished V 

(Saba : 34- 35) 

IB. Condemnation «f Extravagance. 

On the other band (he Holy Qarao severely condemns a 
man who spends his lawfully cmroed wealth in unlawful 
punukis or spepds ii exclusively for securing luxury, pleasure 
and comfort for himself and ba* no other use for his money 
but io raise bis private standard of living to the optimum 

*' And be not prodigals. Lo ! Allah loveth not (he 

prodigals.* 1 (Al-An'im : 141) 

"Oive tbe klosraao his due.and tbe needy and the wayfarer, 
and squander not (wealth) io wantooness. Lo I the squan- 
derers were brethren of the deWU; and the devil was ever on 
ingrate to his Lord." (Bani Israel : 26-27) 

** and eat and driok. but be not prodigal. Lo 1 

He loveih not the prodigal!." (Al-A'raf : 31) 

Jo the view of the Quran the correct behaviour for man || 



to spend at a moderate rate on himself and members of bil 
family. He and bis family have a right on bis wealth and he 
should nerer be stingy ia discharging thia right. But then this 
U not the only right in (be discharge of which he should spend 
all his resources aod neglect the fulfilment of other rigbta. 

"And let not thy hand be chained to thy peek nor open it 
to a toll extent, test thou sit down rebuked, denounced." 

(Bani-Israll : 19) 

"And (bote who, when they spend, are neither prodigal nor 
grudging : and (here is ever a firm station between the two." 

(A|-Furqan : 67) 

"But seek the abode of the Hereafter in that which Allah 
hath given thee and neglect not the portion of the world, and 
be thou kind even as Allan bath been kind to thee, aod seek 
not corruption to the earth. Lo ! AHab loveth not corrupter.." 

(Al-Qasas: 77> 

It. L.irf.l Ways of Spawn].. Wealth. 

Out of the lawfully earned wealth, the surplus that remains 
after reasonable expenses on private needs should be spent in 
the following ways : 

"And tbty ask ihee what they ought to spend. Say ; ibat 
which is superfluous." (At-Baqnrah : 2l9) 

' It is not righteousness that ye turn your faces to East 
and tha West ; but rjgbtcou* is he wbo beiieveth in Allah and 

the Last Day and the angels and the scripture aod ibe 
Prophets ; and gW^ We . llb# for , ovc of ^ JQ ^ 

to orphans and the needy and the w.yfater aod to ihose who ask 
and to set sbv CS f r « - (Al-Baqarab ; 177). 

"Yfi will not atraio piety iDTil ye spend nf ibat which ye 
love. And whatever ye spend. Allah is aware thereof." 

(Ali-ImrSn: 92> 
Aad serve Allah, Ascribe nothmg as partner unto ilia 
(Show)»Ic,oJness uoto parents. 80 d unto near kindred aod 
orphans, and the needy, and unto the neighbour who is of kin 



(unto you) and the neighbour who it out of kin, and the 
fellow-traveller and the wayfarer and (toe slaves) whom your 
right hand possess**. Lo ! Allah ioveih not such as are proud 
and boastfut, who board their wealth and enjoin avarice on 
otbera.aod hide Out which Allah hath bestowed u pon them of His 
bounty. For disbeliever* we prepare a shameful doom, And those 
who spend their wealth in order to be seen of men, and believe 
not in Allah nor the Last Day. Whoso takeih satao for a 
comrade, a bad comrade hath he." (An-Nisa : 36-38) 

(Alms are) for the poor who are straitened for the cause of 
Allah, who cannot move io the land (for trade)* The 
unthinking man accOUttleth them wealthy because of their 
restraint. Thou a ball know them by ibeir mark : They do not 
beaofmco with importunity. And whatsoever good thing ye 
spend. Lo 1 Allah kaowcth it." (Al-Baqarab : 273) 

"And the viripoua for love of Allah feed the poor, the 
orphan and The prisoner and say we feed ynu only to earn the 
favour of Allah. We deaire no recompute from you, nor your 
tratitode." (Ad-Dabr : 8-9). 

••And in whose wealth there is a right, acknowledged, for 
the beggar and the destitute. (Al-Mrarij : 24-25) 

"And such of your slaves ea seek a writing (of emaacipa* 
tioo), write it for them if ye are aware of good in ihem, and 
bestow upon them or the wealth of Allah which He hath 
bestowed upon you." < An-Noor : 33) 

Not only don the Quran regard these experwes as a basic 

■ This refan io four hundred volunteers in the ume of the Holy 
Prophet (peace be onnlm), who had forsaken their homes and gaihcrcd 
io Medina from all pares of Aiabii. They bad dfvotcd their life to 
learning and propagation of rellalcc. They weie »\tt tt-jdy lo march on 
any minion of propagation or of Jitu,d at lha biddingo' iDe Holy Prophet 
(peace and bleating* of Allan be JD him). B«. ds engaged fuH-tioie io 
Ibese dultag they could not atrive for earning ibair li«j D g. (Zamakbsbri. 
al-Kashihaf. Vol. I. p . i2 6 r AUMaiMt-uLOabia. Egypt 114)). 

The order ia ibis ayab will spply evao today to those people who 
devote Uie mselves fu I Mima to teaebloa, propagation of re li gioo and worts 
of Public good and consequently caDOOt rogagc in economic acUvliy 
for their own sake. 

S4 ficoNQksc sYrtm of eslaU 

virtue but also emphasizes that bob -performance qf tbesc 
virtuous acts will lead to social collapse. 

"Spend your wealth for the cause of Allab and he not cast 
by your own bands to ruin, and do good. Lo ! Allah loveth 
the beneficent/' (Al-Baqara : 195) 

12. Monetary Atonements. 

Besides this general and voluntary spending for the sake 
of Allah ibe Holy Qutao has also prescribed financial atone- 
ment for some sins 0 r omissions. For instance the order for 
* person who takes a vow and then breaks it is as follows : 

"Its atonement is reeding ten poor people with the same 
average kind of food wiih which you feed your children, or 
else giving them dresses ; or freeing one slave ; hut whoso 
cannot do the above should keep fast for three days." 

(At-Maida ; 89) 

Similarly the order for a man who wishes to turn to bis" 
wife after having likened her lo bis mother or sister and 
declared her unlawful to bimself is ; . 

"Thoae who put away their wives (by saying they are as 
ibeir moiben) and afterward would go back on that which 
they bave said, (the penalty) in that case (is) the freeiog of a 
slave before they touch one another. And he who fiodeth not 
(the wherewithal*), let him fast for two successive months 
before ihey touch one another ; and for him who is unable" to 
do so (the penance is) the feeding of siaty needy ones." 

(Al-Mujadilab: 3^) 
Etpianons of xhe Same kind bave also been prescribed for 
some omissions in the course Of Hajj (See Baqara : J96. and 
AUMaida ; 95) and a similar penance has been levied with 
regard to any default in observing fas». (Baqara : 184). 

13. Prr-Seqo Elites for t h c Diffae Acceptance of lofaq 
(Spend ing in the way of Allah). 

But this speodiog will be regarded as in the way of Allah 
only when it is devoid of 
* any selfish motive 

' deception or display 

• any attempt to show favour to ot bun ibe feelings 0 f 

^ * an attempt to son out the worn materia] for donation. 

The order it to donate the best and finest good* and apart 

from love of Allah and seeking Hit favour, no other objective 
should be kept la view. 

"And (also) those who spend their wealth io order to be 
seen of men, and believe not in ANab nor the Last Day. 

Wboao taketb sataa for a comrade, a bid comrade hath he." 

(An-Niso: 3«) 

"O ye who believe! Render not vain your almsgiviog by 
reproach and injury, like htm wbo speadeth bis wealth only 
to be leenof men and beiievetb not in Alia* and the I .an 

Dlv " (Al-Baqarah : 264) 

"Those who spend tbeii weolih fur the cause of Allah and 
Afterwards make not reproach and injury to follow that which 
they have apeui, their reward ia with tbelr Lord, and there 
■halt no fear come, upon them, neither aball they grieve. A 
kind word with forgivenei* it better than almsgiving followed 
by infliction. Allah ii Absolute, and Clement." 

(Al-Bioaran : 267-763) 

"O ye who believe ! Spend of (be good tblog* which ye have 
earned and of that which We bring forth from the earth for 
you, and seek not the bad (with intent) to spend thereof (io 
charity) when ye would not take it for yourselves save with 
disdain ; and know that Allah is Absolute, owner of Praise." 

(Al-Baqarab ; 26?) 

"If ye publish your almsgiving it is well, but if ye hide it 
and give It to the poor, it will be better for you and will atone 
for some of your llUdeeds. Allah is informed what ye do." 

(Al-Baqarah ; 271) 


14. The Real Significance of ,Iafaq (Spending In the way of 

This spending in the way of Allah, which the Quran 
sometime* terms as •'JW sometimes Jj~- J JUil" 
(spending in the way of Allah), at other places as •■■fAV 
(Alms) and sometimes as Zakac (Poor due), is not merely an 
act of piety or charity, but as act of worship also and is the 
third among the five articles of faith )0 Islam i.e. Belief, Prayer, 
Zakal, Fasting, and Hajj (Pilgrimage). It has been mentioned 
together with Namaz (Prayer) at 37 places in the Holy Quran, 
aud it has been emphatically made clear that both Namaz and 
Zakut are the essential reacts of Islam and their observance 
the indispensable condiron of salvation." 

The Holy Quran points out that Zakat has always been an 
article or faith in Islam. 

"And Wc made them chief* who were guided by Our corn- 
maud, and We inspired in them the doing of good deeds and the 
right establishment of worship and the giving of alms, sod they 
were worshippers of Us (alone)." (Al-Anbiya : 75) 

"And they are ordered naught else than to serve Allah, 
keeping religion pure for Him ai men by nature upright, and 
to establish worship and to pay the poor due : That is trne 

"And make mention in the scripture of Isbmael. Lo ! he 
was a keeper of bis promise and was a messenger (of Allah), a 

* For instance look up ibe following references in (be Holy Qur&a : 
AI Baqarab ayubs 3, 43, 83, HQ, An-Nisa ■ 77. 162 


(Aj-Bayyinah : 5) 

VI, Til 
Al-Anfal : 3 
Ai Ra'ad ; 22 
Al-Aobiya ; 73 
Au-Haml: 3 
AWbour* ; 33 
Al-Muddaththir :43 
Mar>aa : 31, 55 
Luqm&o r 4 

Al-Mujadlh : 13 
Al-Bayyioth ; s 

AE-Maida : 12, 55 
Al-Tauba ; 5, 1 1.16.71 
lbfkhja : i\ 
AI-Munlnuo ; 2 
Al Abrsh ; 33 

AJ-Ma'arij :23 
AMtfa'oon : 5 
Al-H»jj ; 35.41, 7B 
Ac-Nocr : 57, K 
Fatir : 29 

Ai-.M uzzamiail : 20 


pfophee. He enjoined upon bis people worship and almsgiving 
and was approvable in the sigh* of bis Lord." (Maryam - 54-55) 
"And (remember) when We made a covers witb tbc 
children of Israel (saying) : woiship none save Allab (only); 
And establish worship and p*y (he poor-due." * 

(Al-Baqerah ; 83) 

"He .poke. La ! I am the slave of Allah, ile bath given me 
the scripture and hath appointed me a prophet. And hath 
made rac Messed wheresoever 1 may be and ha ih enjoined upon 
me prayer and almsgiving so long as I remain alive." 

(Maryam : 30-3 1 > 

In the same manner Zakat (poor-due) is an article or faith 
in tbe religion preached hy Muhammad [peace and Weeing* 
of Allah be on him). Like affirmation of faith and Nama? 
Zafcat (Payment of poor-due* also it an obligatory condition' 
fur entering the fraternity of Islam. 

"And Jtrive for Allah aasiriviog for Him due. He hath 
cho-en you nod hath not laid upon you in religion any 
hardship; the faiib of your father Abraham (i* yours) He 
hatb named yo U Muslims of old time. So establish worship 
pay Ibe poor-due and hold fast l0 Allah." (Al-Hajj : 7«) 

"This is the scripture whereof there is no doubt, a fiyidflnre 
into those who ward off (evil). Who believe i D the uuseen 
and establish worship. and <pend of ihai Wc have bestowed" 

U P° n,hem " (A]-Uaqarah:2-3> 
"Tbey only are the (true) believe,, whose heart* fe e f fear 
when Allah is mentioned when Hi* revelation are reciied 
Onto them they increase their faith and who trust in their 
Gud -" (Ai-Anfal : 2-1) 

... r\ 7" Qd ? a bc AiJah ; " d «** Messenger and 
those who beheve, who establish worsh.p and pay the poor-due 
and bow down <« prayer) " (Ai-Maio.h ; Si) 

"But if they repent and «siahJish worship and oav the 
poor-due, then they are your brethren , n religmn/' P X 

(At-Tauba; in 



This Zakat( payment of poor-due) is not only a social welfare 
scheme, but is a necessary measure for the spiritual progress, 
moral reformation, wcU-beicg and salvation of the donors. It 
is not a tax, but ao act of worship, like Namaz. It is an indis- 
pensable part of tbe practical scheme presented by Islam for (be 
spiritual reformation of man. 

"Take alms of their wealth, wherewith thou mayst purify 
them and mayst make ihern grow and pray for them. Lo ! thy 
prayer is an assuagement uf tbera." {At-Tauba : 103) 

"Ye will not attain unto piety until ye spend of that which 
ye love. (Ali-Imran ; 92) 

"So keep your duty to Allah as b«t as ye can, and listen., 
and obey, and speod ; that is betier for your souli. And 
whom is saved from his owe greed, Such are ihe successful. " 

(At- Taghabun : 16) 
15. Obligatory Zakat (Poor duel apd its rate. 

TH« Holy Quran did not confine itself to inculcating a 
universal spiiit of voluntary payment of poor-due in the way 
of Allah among members of ibe society by precept and 
iojunclion, but directed the Holy Prophet (peace and blessings 
of Allah be on bim) to fix the minimum rale of poor due and 
arrange foi its collection and distribution as an obligatory 
duly of the Islamic Kate. 

"(O Prophet t Collect a portion or alms from their 

The implication of the expression "a portion of alms'* was 
thai id addition to the usual charities given individually, a 
fixed rate of poor due should be made obligatory. The 

determination of the rate was left to tba Holy Prophet (peace 
be on him). 

In pursuance cf this order, the Holy prophet (Peace be on 
him) fixed the lowest limit in various categories of wealth 
below which payment of poor due would not be obligatory. 
The Holy Prophet {peace be on him) then prescribed the 


followiog rile of poor due according to the minimum Urn it or 
above of wealth in each category.* 

24% P« annum, on accumulaied wealth in gold, silver 
or ready money.** 

2. 10% per annum on agricultural produce of barani 
land (land watered by rainfall;. 

3. 5% per annum on agricultural produce of land watered 
by artificial devices. 

4- 20% per annum oo produce of mines under private 
ownership and on treasure (rove. 

5. The rate of Zakat (poor-due) on animals kept for 
breeding or sale varies in the case or sheep, goats, cowi or 
camels. For details, works on Fiqta may be consulted. 

By order of Allah, the Holy Prophet (peace be on bin; 
ras prescribed this rate of Zakat as a duty for the Muslims in 
the same way ai he baa made obligatory upon ibem (hi 
performance of certain rakats of prayer Bve times Id a day. 
Id terms of a religious duty and a compulsory obligation 
Zakat and Namaz stand on equal fooling. The Holy Quran" 
regards it as among toe primary duties of the Islamic Govern, 
ment to maintain the institutions of Namaa and Zakat. 

"Those who, ir We give them power lo the land, establish 
worship and pay tbe poor-due and enjoin virtue aod forbid 
ini ^ ui, y-" CAl-H.jj;*]) 

"Allah hath promised such of you as believe and do good 
works that He will surely make them to succeed (tbe present 

rulen)... Establish worship flod pay the poor-due and obey the 
Messenger, that haply ye may fiod meicy." (An-Nur : 55—56) 

But as the study of above-quoted ayah clearly shows, 
although the Collection and drsirtbulion of Zakat (ppof-duc) 

• AJ-Shaukani, Naii-al-Aular, Vol. 4, pp. 98-126 ; Mmlafa *| BiW ~ 
Egypt 1347. 

" Later M was resolved by cooseoiuj that ih e same rate of poor due 

vl. V' P * f , 4 ,T ai ^ lC,,Jdbel V ied 0Q a™ 6 ""* ««*•• WI-ShatAaai, 
VoJ. 4, p. H7). Thu tate of commercial ZaUt (poor-due) win »i M be 

imposed on factories roacuf&ctuiai foodi foe sale. 


U included among tbe obligatory duties of tbe Islamic state 
yet .0 the absence of an Islamic state or when the hlami c aW 
neglects to perform this obligatory function, the duty of 
Muslims to pay Zakat (poor-dme) is not extinguished, just as 
the duty of offering Namaz is never suspended. When no 
afieocy or institution for collection and distribution of Zakat 
exists, ewb-indivjdual Muslim upon whom Zakat ii obligatory 
should set aside the portion of wealth due from bim and 
distribute it himself. 

16. One-Hftb of Ibe Spalls of W«. 

To the fund established by levying obligatory Zakat, the 
Holy Q Ujan add? another head of revenue, which is one portion 
of the spoils of war. The Holy Quran lays down the rule that 
the soldiers instead of expropriating their individual loot 
shontd deposit iL wirh- their commander, who should divide it 
into five equal portions and distribute four portions among 
the troops who look part in the battle, leaving the ttih portion 
to be deposited in the Government account. 

"And know that whatever ye take as spoils of war, Lo I a 
fifth thereof is for Allah, and for the messenger (i.e. for the 
itlte, to be used for that commonweal) and for the kinsman i 
(oeedy) and orphans and the needy* and tbe wayfarer.'* 

„ „ (Ai-Anfal : 41) 

17. ChargM on (be Zakat Food. 

The fund collected from (be above two heads of revenue 

* Du "n« b'« lifetime ibe Hofy Prophet (pew* be on him) used ro 
receiv* a poiiiQD of lbs flfib share of Ibe ipoiU of war a» personal and family 
alloweoce. 'or bt-(p«*f< be oq him) and bit family had no share fo Zaical 
After the Prophet's death. • debate arose ai to who should receive (be 
shaie previously giy«o to tbe Ptophet and hi* family. Some argued (bat 
Ibis share was paid id the Holy Prophet (peace be on him) aa an honor, 
arium for bis duties aa head of the state and ha 0 e c it abould now he remit- 
ted to the Khalifa aad bis family. Another action held that toll &hsn tS 
the perpetual right of the Prophet's family and ibouid be paid lo thorn 
even after the Prophet's death. It was finally agreed io allocate the ahara 
formerly paid to the Prophet and hii family to tbe Defence Budget of the 
Islamic Slate. AWaasas, Vol . 3, pp. 75-77) 


QtntAK 61 

doea not form pin of the P-Jblic e«&CGucr .kU r 

fund to the following beads of expeose : 

"Tbn .In, aw only for .he poor* aid th e n.edy, and. those 

udAcfa^r? ? be h rtc0Q£,Ied - 4 «" d * '™ 'he captive* » 
and debton, and for the cu» of Allah.* „ d for tfa, wayfarer,* 

2. T&c root cue 
term ^ "Faqir" 

£°", B ,££ 1110,1 of h " ^ rtJ ""'" d v * * 

to «™ H4,3 ' BI d ^ flC<1 ' MWr "*' * * P*'«" *ho baa co capacity 

tKt u 0B mnlov«l J it , ! . lOM lac cipiW to earn and 

to .a" 2 "MhkE" * * t.mpor.nly toil t h« opportunity 

wa. altan^ T Il0H °* H ° fy Pn "** 1 fpetc * beon n»Oo...ry aid 

fC ' ThS^^,?" 1 1,ta * 'f f * «*eo raonaurr help to all C v| if , 
^"■iconientfd oifabcrt. <A|.JattM V„l j V 

(ion and the foroer il«v„ "rcedom by eiy j ni corqpeni.- 

^teAlS 0Ul r ? r i eh .' d CM *" iJ > phonal 
cannot be ^ r * r ,h * ««■! of E p"?wn 

of transport to S taMSii"" B WSfT , -r OT M h * d " nd n,W,in « « * "*? 
c« in the court* «r k- / Srt »«i*Hy ifa p.Ignm rum au: 0 f j« 0 " 

( AW »w«. Vol. 3, p. Ijft, 



a doty imposed by AlUh. Allah is R BDitli Wise." 

(At-Tauba: 60) 
18. The Law Regarding the Divisfon of Inheritance. 

The Quratiic law regarding the legacy of a deceased man or 
woman ia that it should be divided among bis or her parents 
children, wife or husband according to a fiaed ratio. However 
in the absence of parents or Children of the deceased, bia or her 
Akhyafi (of tbe same mother hut different father) or Allali (of 
the same father but different mother) brothers and listen should 
share in (he inheritance. Sura Nisa contains detailed ordcraon 
thii subj et*. (See iyabs 7-12 and ayah |76). Space does aot 
permit tbe reproduction of those orders here. 

The principle enunciated by Islam in thii matter is that tbe 
wealth which a person hai accumulated in bis lifetime should 
not remain Concentrated after hit death, but should be distri- 
buted among his relation*. This principle is the antithesis of 
the law of priraogenfiure. the jo iot family synem and other 
customs or usages of the same nature, which buically seek to 
keep the accumulated wealth of a person concentrated even 
after his death, Similarly the Qurrni repudiates the rule of 
adoption, and ordains that only tbe grouioe relatives should 
share io the inheritance. No stranger can be adopted as a ion 
for the purpose of appointing him a heir in the artificial 

Nor bath He mode ihoic whom ye claim (to be) yoor 

sons. Tbia is but a saying of your mouths. (Al-Aozab : 4) 

"And according to Allah's Book, the relations have a 
gre|ter right upon one another'*. (Al-Ahzab ; 6). 

But having fully safeguarded the rights of relations who 
are the real h?ir<, ibe Holy Quran eoj3ia 1 them to voluntarily 

" According 10 the Holy Prophet's (peace be on htm) Interpretation 
of this law, in The absence of trie nearest relations, the nearer rclartvei 
shall inert in the legacy, end ia the absence of <he nearer relatives, the 
legacy shall ba divided among those who stand io a relatively closer 
relation wltb the deceased than the strangers. However in the absence of 
any relation, near or dEitant. the legacy shall be annexed to the publio 
exchequer of th* Islamic Government. (Nsii-sl-Autur. Vol. 6, pp. 47-5S.> 


gw« some sbireoftbelej^ to those relations also who have 
no claim to inheritance, but who arc present ac the time of 


"And when kinsfolk and orphans and the needy ones art 
P*e*ent at the division (of the heritage) bestow or them (here- 
from and speak kindly unto them. And let those fear (in their 
behaviour toward orphaas. who if ihey left behind them weak 
Offspring would be afraid for them. So let them mind their 
doty to Allah, and .peak justly.- fAa-Ni-a ■ ?-«> 

19, The Rule of Making a Will. 

Besides enacting the law of inheritance, the Holy Q Ur a Q 

ordain, that . person should make a will about his property 
before hit death : 

"It is prescribed for you. when death approaches one of 
yon, tr he leaves wealth, that he bequeath unto parents and near 
felahve, in kindness. (This it) a duty for all those who ward 

" { V!?'\ t (AJ-aUwrtbMBO) 
Jhe object G r this injunction is that in the nrst plane th e 
person whose end is near should exhort his children to be good 
to their grandparents, for young people can be scarce! y expected 
to do good to the aged parents of tbeir deceased father • 
and secondly, if there are some persons in the family who are' 
legally excluded from inheritance, but the legator wishes to 
help them he should jncludc them as Carers in the will. i fl lh , 
Mine way ,fa man i» leaving considerable wealth, he can will a 

ShKnnt b \ doQaled '° * 0rk » « f P^l.c welfare, for the 
object of the above-quortd ayah is certainly not to limit fat 

*m^^j^^»^ d ^vu alone- . The cal of 

S?1?r2 tlS . V '° Pt ° itCU 0f > ubFlc ™e words 

ihanroleav , >™ *- ' * " er t9rtoa lo Ieav * yo,fT hc[r * *>W ™™ 
Z plop ™ ,hrm,oacofldi '^^*«" «n*Privatrun«tii„g.| 1BI troeft'. 



wjII flud mhcriuncc malce, it esplicil that tbs Islamic scheme 
regarding the legacy of an individual is that two-third of the 
legacy must be distributed according to the La* of Inheritance. 
Tbedistnbutionof theremaiomgooe-ihirdmay be left to the 
discretion of the legator. IO thai be or she may will it to be 
spent for any purpose, provided that the purpose is lawful and 
also that the right of no oik Is Jeopardised*. 
2». Safeguarding the Interest of Persons of Unsound Mind. 

Regarding personj or unsound mind who c3nnoc manage 
ihc.r property „ d are wastiog it ur urc likely to waste j t . lhc 
•njuoct.oo of ths Holy Quran is that their properly. should be 
placed under the conlroi 3 f their guardian or court of ward* 
The property shall not be restored to the independent control of 
» person of unsound mind until there is absolute proof that he 
or she hat the capacity to manage il. 

"dive not unto the foolish (what i, in) your (keeping of 
their) wealth, which Allah hath given you as maintenance, but 
feed and cloth* them from it, and speak kindly unto them. Prove 
orphans rill they reach Jbe- mariia R cab)c age ; then if ye Bnd 
them of sound judgement, deliver over unto them their 
for,UDCS -" (An-Nisa : 5-6) 

This ayat enunciate* a Q important point which is (hat 
though individuals ire owners of the property to which they 
have a legal title. y« their owdenbip is not full or absolute in 
so far as the collective interest is also anached to the individual 
right of ownership. H is for this reason that the Quran uses 
the term "^^.l" { your property) instead of >*Jl>.r' (their 

■ Bxplainlna the U* of will, che Hoi, P rD ph«t (peace be 0o him» 
■ubjected the right of will to three restricting : One. a man can auicbe hit 
right of will uplo one-third portion of hi- legicy al the maximum ; wood 
fWthlugcanhewilled'toaflyocewhohu.lee.] share la InheriuoU with- 
out the consent of o(ber heirs ; thirdly, no heir can he e.cMed from 
ioherltfluce by wi|J nor his ihars be decreased. 

(NeiJ-al->mar, Vol. 6, pp. 31*35). 


It a on this same basis that when private property it 
being managed to the detriment of public interest, oris being 
so managed as to create a rcatooable apprehension of public 
loss, the Holy Quran authorijes the guardian or the judge (Qaii) 
to takeover charge of the properly, leaving the owner'* (illc 
and right of uae intact 1 . 

21. Cammam Interest in Statu Properly. 

Regarding estates, goods and revenues which are fltats 
property, the Holy Quran Ordains that they should not be 
managed io the interest of the wealthy claasea but in (be interest 
of general public and more especially for the bencflt of the 
poor clashes of the society. 

"Tbat which Allah giveth as spoil unto Hii Messenger from 
(he people of the townships, it i, for Allah and Mis Messenger* 
and for the near kin J and the orphans and needy and (he 
wayfarer, that it become not a commodity between (he rich 
Hmoaiyou. And foe (he poor fugitives who have been J riven 
oat from (heir homes and their belongings ; Those who entered 
the city and the faith before them. 

And those who came (ioto (be faith) aHer them deserve 
»'">■" (Al-Haahr : 7-10) 

22. ' Bask Principle of Taxation in him. 

The principle of taxation as indicated by the Quran is that 
tbe burden of taxation should fall oa the claucs which possess 
more wealth than they need, and especially on (hat por(ion of 
their wealth which ii left over afier fuHHing. all their needs. 

1. lbo-il-Arabi. Ahkarn-ul-Quran. Vol. I, p>. U3. 

itw-l-Kathir, Tafiiiol-Ouran. V 0 l. j.p. 452. 

AJ Jsssss, Ahtam-aJ-Q-irso. Vol. 2. pp. 72-73. 

2- lota refers lo expenses an administration and defence of (be 
Isliarc Stale. This include! rha allowance drawn by the Hob' Prophet 
(peace be oa bin) and Jatsr bv his Caliphs (Allah be pieaicd with ir»m> foe 
vbstf personal expanses, and ibe salaries of iheir ittff, (aaeludiac- tbc 
salarissof lbs rimcrionarics of Zakat Apartment). The of tbe 
fuecnensrto of (he Zafcac d.parime,,: were charted omht Zakat fund. 

h For detailed explanation reftr to Ppotnote" at Paae No. «. 


fc "T*?' "* Ttec: Wbat th ^ s hauld spend, Say: lhat 
wmcn is Jclt over after meeting your needs.". (An-Nisa : 219) 

Characteristics or rbe Economic System of Islam. 

The basic principles and outstaodicg characteristics of the 
economic system ensealed by the Holy Quran in twenty- two 
points are a, f 0 |] 0 w s :— 

Firstly, Islamic scheme lays down such methods of achieving 
social justice as suppress all forms of economic oppression and 
unfair exploitation on the one hand and on the other generate 
and develop moral virtues in society. The Holy Quran does 
not envisage a social order in which there ii no scope for 
private acts of phiianthrooy, entrusting the entire field of 
social welfare to a Bureaucratic Machine, for in such an order 
there is do room for the growth and development of moral 
virtues. On the contrary the Holy Quran established a social 
order in which while dealing with one another the individuals 

Jvmn^K ""j u by " of ^'"^'y "d selfless g^osity, 

sympathy and benevolence, which promote love and concord 
among them. To this end, Islam largely concentrate on 
devismg means to inculcate faith among the people and to 
make them better human beings by education and training. 
To make up far any deficiency that may stjll be left, IsIiq 
enforces such compulsory orders as are inevitably needed to 
promote socwl welfare. (See Points 8 to U and IS to 19) 

2. Instead of maintaining B distinction between economtc 
and moral values. Istam harmonises both and rather than economic problems from a purely economic standpoint 
u resolves ihem according to iheir proportionate value in thai 
collective order of life whove edi6ce Islam has raised solely on 

the foundations of ihe Divine concept of the universe and the 
Divine philosophy of ethics. (S « PoinIS i, 2 , 4> 5) 

3: Islam proclaims that the economic meam aod resources 
Jo the earth are Divine blessings open to all.: which implies 
that no kmd of monopoly whether personal, tedional or 
nat.onal will be encouraged, Instead freedom of Economic 


Endcsvaar shall be afforded to e W y human being to (he ut- 
most possible extent. (See Point 5) 

4. Islam grant* to the individual the right of private pro- 
perty, but (his right 1$ not unlimited. In addition to imposing 
necessary restrictions on the rigbrof private ownership in the 
interest of other individuals and the collective social order, the 
economic scheme of Islam establishes the right of ihe relaiivea, 
neighbours, friendj, the needy and the destitute and collec- 
tively, the right of the whole Society nn the wealth of each 
individual. Some of these righia are to ba enforced by Uw. 
aad for the recognition and fuiaiment of nthcrl, provision has 
been made to train the individuals by Tntcllectual and moral 

(See Points 3. 5, 7. tn 15. 16, 17, 10, 20) 

5. According to (his scheme the natural proceis or fun- 
ning the economic order of hum in life is that the individuals 
should operate and develop (bis order by free endeavour. 
However this freedom of endeavour is not unlimited, but in the 
intent of ibe society and for the individual's own moral, 
cultural and economic welfare, some restrictions have been 
imposed on individual freedom. (Sec Points 6, 7, 15, 22) 

6. Islam gives equal right of ownership to man and woman 
in tbejr earned or inherited wealth or wealth secured by any 
other lawful means. Both Sexes bava been given equal rigfcu 
ai regards the use and enjoyment of their prnperty 

(See Pointe 3, 4, IE). 

7. In order to maintain a balanced economic order, on the 
one hand Islam encourages people to enjoy Allah's blessings by 
condemning avarice and ascetic living and on the other, the 
people are strictly forbidden to indulge ir. o$tcnUtit>n. extrava- 
gance and high living. ( S „ Poiats 5i 8 t0 10) , 

8. In order to establish economic justice Islam provide* 
that wealth should not flow through wrong Channels ia one 
particular direction nor should the unlawfully gained wealth 
accumulate in one place and remain uo productively blocked 
there. At the same time Islam provides that money should: 



tome into rapid use and circulation and ii, fl0 w S0011 m 
ally beneBt those section, of ,be .ociety ^ J™ ' «P«- 
lagged behind in obtaining their due share " itOB 

(See Points 6 to 10, !2. ! 3, 15. 17 to 19, & jjv 
« . The economic scheme of 1,1am doe. not largely denend 
on la* o, s .,te to intervene in , at „,„„ of establishing ^ 

un ' M 7° " CUre lhi * ™< " , " n 

unavo.dable duties to .he Stat, and enforce, t be rest of it „ 

ecoaom.c plan, by intellectual and mora) training of individual 

»d by effecting genera! reform of tbe ,o:iety to tha, economt 

Stltt J?r e " ,bli5lled l "P'' n « '» vi " "»* 'ogi«l require- 
m««ii of « free economy. (See p 0 ; D „ s to 3J) 

10. In.tead of creating cl« !S conflict between variou, ,eo 

promote, a ipint of cooperation and unity among tbe 

(See Point, 4. 6 to 11, 12, and 15 to 17, 21, 22)' 

mJ^" 1 ° f P rinci P'« "> fori of 

system of state and society in the time of the Holy P, 0[ ,h ( , 
(peace and blessing, of Allah be on him) and lh"r Li C ufded 

bis (Jweuswon fall, tbe scope of this chapter Tho 
literature of Haditb, Jurisprudence History .Vrf T vT 
of tbe HoIy Pfopbet ^ anJ Si^^^fi 


BrbiiogMphy of SoBrc „ 

. The Holy Quran. 

■330 mw «> **» 

iMj Alu S i, R o 0 h.ul-M a - to -. Id^-M-Tab-ha-al-Muuiri,, Egypt 

l347 A H JaS "'' Abkl — M **b*h-.l Babia. Egypt. 
^Itaal-Arabi. Ahkain al-Quran. Matbah-al-Saada. Egypt, 
^^Ibn-i-; ft rir, Jam.-al-Bayao. M«h t h-.1-M«ii™. Egypt, 

^AJ-Z.a>iM,,hrl. A-MCaababaf. AMMKMMtfh, Bgypi. 

Al-Bukbari, Sahih. 
Muilim. Sabib. 

Abo-Dawud, Sunin. 
Al-Nasai, Suaao. 

Ibn-i-Maja, Sunan al Mustafa. 
1347 A M. SbaUkaDi ' H *** AM "- M„lafa-ahBabi. Egypt 

133? H* AWl1 B "' a '' ISte * b, Dai " IUl Ma " if H * d «'^ 
Ibo-i-Maazur, LJ 5 a fl - u [. A rab. Beirut, 1956 A.D. 

Basic Principles of 
Economic Life 

(Formulated in (be light of the Holy QoriuaV 
Fundamental value* uf Islamic Society. « 

"Lo Allah cnjoineth Justice and kindness, and giving to 
kinsfolk, and forbiddetn lewdness and abomination and 
wickedness. He exhorteth you in order that ye may take 
te** " " (An-Nahl : 90) 

This short verse contains three orders upon which depends 
all social reform. Firitly. there is Justice. The concept of 
Juittcc is composed of two constant factors. 

(a) Maintenance of Equitable and balanced rights amoofl 

(b) Everyone should receive fail due right without fear or 
favour. The Urdu equivalent of Justice ii 'Insif', 
which has a misleading connotation The Urdu 
word conveys the impression that two men should 
>bare rights in equal proportion on the basis of fifty 
percent each. So it is commonly held that Justice 
means Equal distribution of rights. But this is 

1 We bavc incorporated relevant noiu and discuwioDS from Tafbirn- 
ul-Quraaa( »u'tabk poinis m Ui'j book. Some important noici however, 
could not find room under any particular chapter beading, A few of Thew 
noica are preceded bctow in a ict older. For thi safce of continuity 
partial .amendment haj been made at certain point* in the te*i and a word 
or sentence bai been added bene and There. 


2. Refer to TafbinvulQuran Vol. 11 P. 364 to 566. 




unnatural. What Justice in fact, demands is not 
equality but balance and Equity. In some respects. 
Justice no doubt requires complete Equality among 
citizens such as in civic rights. But in some other 
' respects the principle of Equality is contrary to 
Justice, for instance social and moral equality between 
parents and offspring, or equal compensation to 
higher and lower cadres of service. Hence what 
. Allah has decreed it not equality of rights, but 
balance and equity in the rights of various classes oF 
people. This decree requires that each man should 
receive hia due moral, social, economic, legal, poli- 
tical and cultural righta fully without fear or favour. 
Secondly, o'— > favour which denotes fair dealing, 
liberality, sympathetic altitude, courtesy, mutual 
accomodation, mutual regard, giving the other slightly 
more than bis due and be content with a little less than 
one's doe right. Favour thus is a complement to 
Justice and hence bean greater social value than 
justice. Justice ia the ban of society , Favour its 
grace aad excellence. Justice removes conflict and 
bitterness from society, favour fills it with pleasant 
harmony end sweet accord. A calculating mentality 
among, individuals and a business like attitude in the 
payment and receipt of dues cannot be the only basis 
of social organization. 

Such a cold and m persona] society may be Tree from 
conflict, but it will also lack such virtues as love, gratitude, 
magnanimity, self-sAriflce, sincerity and sympathy, which 
make life pleasant and sweet and promote collective virtues. 
The third order contained in this Ayat relates to w — -j «X- 
kindness which suggests a special form of doing favour to 
relations. It dees not only imply good conduct towards rela- 
tions, sharing their joy and grief and lending support and 
assistance to them within justifiable limits, but also contains 
the meaning that each affluent, person should not only recognize 



the rights of himself and bis family over bis wealth, but ad mil 
that he owes obligations to his relation* also. The Shariat of 
the Divine charge affluent individuals of each family with ihe 
dutyofprovidingfooJaodclwbingtoan indigent member of 
their clan. A society cannot be in a worse slate than when one 
of its members has all the joys that life can give while other 
members of his clan cannot afford eveD bread and clothing. 
The divine Sbariat considers each family as an important organ 
ofihe body-politic and lays down the rule that indigent persons 
have a prior claim on affluent members or their own clan and 
afterwards on others. It is this point which the Holy Prophet 
(Peace and blessings of Allah be on him) has elucidated in many 
of his statements. Several traditions explain that the first 
charge sf a person are his parents, his wife and children and his 
brothers and sitters. His next charge are proximate relatives in 
the descending order. 

It lion the basis of this rule that Hadrat Umar (Allah be 
pleased wjtfa bimt bound snrnc persons to take charge of their 
orphaned cousin- Delivering his ruling in favour of another 
orphan, Hadrat Uroir (Allah be pleated with him) observed : 

"If thit child had even a moil distant relative, I would 
have forced him to take charge of the child". 

The level of economic affluence, social harmony and moral 
pur.iy and excellence of a society wherein each unit support* 
Ha members in this manner can be readily imagined. As against 
the above three virtues, Allah forbid, the following three evils 
which cause destruction to both individual snd society. 

Firstly, obscenity which covers all absurd and indecent 
act,. All evils are heinous in nature are obscene such as 
stlDSfness fornicat.on, nudity and exposure of body, sodomy 
marnage between collateral,, felony, o^inktng,, reviling 
andfoulapeecb. Similarly open indulgence la evil and pro- 
Swdcr* ob K ene acta such as false propaganda, 

. J « KCrel CTmeS ' P° rno ' ra P hi ' short 

SnJT 3 i ' ( ' m * k •^WlloOto.opcolBixiDgof 

sexes and stage performances of actresses. 

Secondly : there is which refer, to all things which 

r L Whlch havc Proscribed by all Divine Scriptures and 

Prophet, (Peace be on <be*>. The third tbiag Is ^ whTcn" 

others, whether of the creator or the creatures. 

These are the fundamental value* of Iilimic Societv I* 
the duty of the citizen and ,he Government 

en „ e the va| ues which form the basis of Islamic 
It is the duty of the citizen and the Slate to safeguard 

***** . od U5e ,„ lhc foree ; f - » - — 

The Course of MoraJ .ad Ecoaomic Evolution in Mam * 

-So give to the IciQlmtD his due. and (o the needy, and (o 

An<l such ar« they who are successful.-' 

rclat^n,' T % V ?' yM ^ your 

» at on., the poor and the traveller. The t«t rather .a,™ thai 

it » their rxgbt and your obligation, which you must dS 

heS an' rt rT 1W t"* * f " VOUr ° r U " 1 I™ " C * 

beiBg and he la a miserable creature living; on your dole fin 

True Lord h-s « bieued you w«h more and others with less, then 

.V 81 T hflVB ** " ******* of others and by 
entrusting th.s surplus f you Your Lord puts y OU on ttii ,S 

see whether you pmy the rights of the needy ones or not 

Anyone: who reflect, apou the letter and spirit of this 
Dwjne Order w.ll no( faii to realise that the course of moral 
and spiritual evolution of mao Qs cur-liced by .he Quran ore- 
supposes the existence of a free society and a free economy Such 
an Evolution is not possible in « social environment where 
proprietory rights of individual, are abolished, all economic 
"ttourcc^re nati onalized and state eaercises monopoly control 

U Tafhim-ul-QurflQ Vol ; m pl?J7). "" 



over distribution of wealth am0D£ citizens, thereby preventing 
an individual from owing any obligation to another 'or to 
cherish sentiments of sympathy aDtI goodwill for anyone else 
Such a purely communist social and economic system which in 
our country is being aggressively imputed to Quran Ua0cr ( h 0 
dtcepiive title, of "Mamie Socialism" or ■ 'Quran! Niitm-i- 
Rabubiaf, is the antithesis of the Quranic Scheme, for the 
comraunLit system stultifies the development of individual 
morality and totally curbs the formation and growth of indivi- 
dual character. The Quranic Scheme can only be implemented 
in an environment where Individuals own long economic 
resources, have tbe right and authority to use them freely and 
then willingly a0 d with open heart P a y tfao rights of God and 
man out or those resources. J; i, in such a society that (here 
arises lhe phenomenon of affluent individuals developing the 
subUmc virtues of sympathy, kindness, affection, self-sacrifice 
consideration and fulfillment of obligation and tbe beneficiaries 
entertaining (be pure sentiments of support, gratitude, love, 
sincerity and returning favour for favour towards their bene- 
factors, till such an ideal environment is created wherein the 
curbing of evil and promotion of good does not depend on the 
intervention of Authority, but o D tbe pure resolve of the 
individuals to discharge their obligations to the MH. 

Provision and its use. 


"And strain not thiae eyes towards that which we cause 
some wedded pairs among them to enjoy tbe flower of the life of 
the world, that wc may try them thereby. The provision of thy 
Lord is better and more lasting". ( Ta - h**-i3I) 

• I have tranced 'Rizi,' .."Lawful provision," for Allah has 
nowhere referred to illicit things as Rizq-t-Rab "the Provision 
of tbe Lord." The implication is that it does not behove 
you or your compatriots in teligion to envy the glamorous life 
of the wicked and corrupt who amass wealth by illicit means 
Such wealth and glamour is not at all enviable for you. The 
pure livelihood which you earn by lawful means, howsoever 


Jneagre it may be, is belter for truthful and faithful men and it 
contains goodness, which will Jast till eternity.* 

"Allah givcth blessings without jtrat (o whom He will*" 


Allah enJargcth the provision for wham HewiJJofHls 
»Uvw and slrartenth it (for whom He wiU)". 

(ALQani : 62) 

AHah'. wmrt 1 inC K deCrC " W ° f IivcMh00d dc P end8 on 
A/lah s »,Jj, wh^h „ b*^ on wverai other cooperations. 

The bestowal of annfc livelihood upon a parson docs net neccs- 
oerton i h sf T SOn,C,,m " il »° '"PP'™ that a 

over hun .he lU.h wrath of Ail*. On the othe. h.nT'r Ym 0n of ,h„ fJcl ,h.t Im*.^,^^ 
even though In rdi.y they „. ii„ bIc lo ,„„„ A P , U)) ., 

"Whose Te.r when All.h is mentioned lnJ arc P j, ieI „ 

. „ fA/-Hajj : 35). 

J have Mpfcbcd , boyc ihat A|Iah haj ^ 

mcmTr^ RDt in, P'> ^ ofcpense." It means f u WI- 
mcm of the lc 8lt ,m„te need, of self and family, kndiajt Stance 
«ircl n .fv«.nc:ahbmir* and the needy ftBrt . co.itrib«li«,. <o 

Vol: in p. ^o. 

p. 664. 


works of public welfare, and financial donations to the cause of 
the establishment of Allah's creed. Extravagance, expense on 
pleasure, ostentatious spending are not what (be Quran e a | Is 
Infaq "Expense". The Quranic terms for this type of expense 
are "Cxtavagance and ^ (excess). The Quranic term i3*! 
"Expense" likewise does not pertain to tbe niggardly and miserly 
expense of a man who does not spend on the legitimate requir- 
ements of self, family, and needy people of God in full measure 
according to his means. The Quran referj to such spending as 
"Stinginess" and ^ ^ • 
The Principle of L'm. 

."Eat of that which Allah hath bestowed upon you, and 
follow not the footsteps of tbe devil, for Lo! he is ao open foe to 

you '" (AI-An'Sm ; 142). 

Here Allah enunciates three points, one, that the gardens, 
fields and cattle which you possess are a bounty rrorn Him aJone 
aod no oneelse Hence no other being can claim a share of 
your thanksgiving. 

Secondly, since you ha\c received these things as a gift from 
Allah, it follows that you should abide by tbe rules which Allah 
has set for their use. No one-else has tbe right to determine 
rules for the use of these gifts. To observe the rules prescribed 
by other than Allah and offer thanksgiving for the bounties to 
other than Allah amounts to transgression and following the path 
of Satan. 

Thirdly, all these gifts have been created by Allah as food 
and drink for man and for his other uses He has not created 
them so that man should renounce them The curbs that men 
have whimsically and superstitious! y imposed on articles of food 
and other things provided by God are contrary to the will of 


"O believers! forbid cot 'the good thing which God hath 
allowed unto you and trassgr^ not, for God ioveth not the 

Tafhim-uMJuMo, Vol: tH P- 22S. 
Tafbiin-ul- Qorao VoJ:I P»5». 



transgressors. And cat of the lawful and good things which god 
hatb given you end fear God in whern you believe." 

(Al-Maidah S7-3ft> 

TbiaAyat reveala two points. One, do not determine pro- 
hibition! and permissions at will. Permitted is that only 
which Allah has made lawful and forbidden is that only 

which Altah has made unlawful. If you prohibit the (awful on 
your own volition, you will be guilty uf following the dictates of 
your own desire rather than the dictates of the Almighty. 

Secondly, do not follow the way of Christian monks. Hindu 
ascetics, Budhist monks and En rem Sufls. Among the nobfe 
minded followers of every .religion there baa always existed a 
tendency to conjider the satisfaction of physical urges an 
obstacle in their spiritual development. They are inclined to 
believe that ascetic living and renunciation of all pleasure and 
comfort is a virtu© without which Allah's favour connot be ob- 
tained. Among the illustrious companions (AHnh be pleased 
with them) also, there were a f-w who subscribed to this view. 
The Holy Prophet (peace be on him) once learned that some 
companions had taken a vow to fast during the day. pass the night 
in worship, abstain from meat and fat and renounce intercourse 
with women. Thereupon he (peace be on him) delivered a sermon 
in the course of which he observed ; "This is not my Creed. Your 

body has rights over you. You should fast, but eat and drink 
also. Pray at night, but sleep also Look at me. I sleep and 
1 pray also. I both keep aad omit fasfs. I eat both meat and fat. 
So Whoso does not subscribe to my way, he is not of mine." 

Me (peace be on him) then said . -What has happened to 
people that they have renounced women, good food, perfume, 
aleep and worldly pleasure? I have never taught .you to be a 
monk or a priest. In my flw (Creed) there ii no provision for 
rentinciatfon of women or meat ocr for abandoning the woHd. For 
setf<ontrol, I enjoin fast. Alt the advantages of ascetism can be 
had from the Jihad of Islam. Worship Allah and do not associate 
naught with him. Perform H a }J aD d Umra. Establish Namaz, 
pay ZAkat, and keep fasts i* Ramadan. The people who came 

78 BcoNoanc sr*™ or uui 

to ruin before you met this fate because they were hard on (hem- 
«ive S and AUah was hard o 0 the* IO o. It is [QC remnants of 
these poop| c that you sec in monkeries and convents " 

Some other traditions on the sane »ubje« rcl.te that tbe 
P '°P hct ( P eaco t>= on him) once learned regarding , CO m. 
panion that it was long siace be had gone in t0 hil wi r c ^ Was 
engaged in prayer day and night. Th= Holy Prophet (peace be 
on h.m) summuaed him and ordered that he should go in to 
his wife at once. T am failing submitted the companion. "Break 
your f a « .od proceed." the Holy Prophet (peace be on him) 
old htm rn the reign of Hadrat Umar a woman combined ' 
•My husband fasts during [he day and is engaged in prayer 
during the night and does not associate with me.- 

Hadrat Umar appointed the well-known T.bia dignitarv 
Kaab-bm-Saur at Ziddi to hear this«« and he gave the verdict 
that the husband had the right to pray as much as he *i s hcd for 
thi« mghts, but hi* wife had eaclusiue right over him in eh« 
fourth night. The phrase 'Transgrewing tbe bound.* in this Ayat 

? ? c * ano ' ation Toaifb ,awful and 10 rcnoun « «hing. 

which Allah has dcL-fared pure as if thev were impure <* a 
form of transgressioa. Excessive and use of 'pure 
things » tbe second kind of transgression and over-stepping 
the bounds or the lawful to enter the domain of the unlawful 
to the third kind of tran^re„ioa. Allah abhors ail these three 

The Principle of Moderation 

• And those who, when they ipend. arc neither prodigal 
nor grudging; and there is ever a firm station between the two; and 
those whocry not unto any other god along with Allah, nor take 
the life which AUah hath forbidden save in <cf>urse of) justice hor 
commit aduftery, and whoso doetf. this shall pay the penalty 
(Al-Futqan, 67.68,. In other words they neuher fritter away their 
wealth in luxury, gambling, drinking, pa.ties, festiviriej 
wedding? or ostentatious expense on food, house, dress and 
furn ishings, nor are they spendthrifts and fanatic lovers of 

I, Tofhln+uLQwon, Vol. I, pp. 499, 499. ] 

»*»c ratNcraa or 

™ 79 

w m flM i„ Z^b^ TV ca, <* 0 '™ of People 

Between these two extremes IiJam n,«^». * ^ 

uoe 'J^^* middlC W * y M oae '« "ving is 

0De « toe marks of a fa^ib u wise man)." 


T*^'**™*. Vol. lir, pp. «©. 4R, 


Hoowty aai Justice in Economic Life 

"And unto Median (w c sear) :beir brother, SiuiJb H- 
aaid : "O, my people ! Servo Allah J Ye have Qo other G*l 
save Him. Lo ! a dear proor hath come unto you from y 0 ar 
Lord ; so give full m-isurc »od full weight sad wrong not man. 
kind ia their goods, and weak not coDfaiion in the Earth after 
the f-ir order thereof. -That will be better for y ou , if y e are 


"But the chieftains of his psoplc. who were disbelieving 
said - If ye follow Sbu.,b, then truly ye shall be the loscra". 

( A I- Araf : 90) 

The firat Ayai reveals that Hadrat Shuaib's natioo suffered 
from two principal miladies : One, Polytheism, second, unfair 
business practice*. The purpose of Hadrat Shuaib's prophecy 
was to remedy these maladies. The reaction of the leaden of 
the nation should not be pissed over lightly. One must pause 
mod eoasidet it seriously. Th« point that the leaden of Median 
ware really trying to make and instil into ibt minds of their 
people was thai the adoptioo of Shuaib's Code of integrity and 
troth and permanent adherence to bis rules of morality and 
honesty wilt spell our ruin. If we always speak the troth and 
do fair transactions, how wonld we keep our business afloat 1 
We who live on the cross road of the two greatest trade routes 
orthe w 0 :ld and arc settled oa the edges of the magnificent 
civilisations or the Egyptiao and Iraqi Empires, irwc stop 
molesting the caravans and become harmless and lawful people, 
wc will lose th= economic and political advantages of our pre- 
sent geographical position and our hegemony over our neigh- 
bours will dissolve. Such reasoning was not confined to the 
chief men of Hadrat Shuaib's nation. The wicked people of 
every age have sensed the same dangers in a way of life based 
<"> Right, Truth and Honesty. In each age the evil teen have 
cherished the belief that Commerce, Politics and Religious 
affairs cannot be managed except by false pretences, dishonest 
means a n d unethical practices. 


■ ri!L*«« P . laCei ' "V* lbC vi « ofDUl| y P f »»d chtr«« a „ |0W 

Principles and 
Objectives of Economic 
Organization in Islam 1 


i have been invited to apeak on a few set topics Let 
me repeat these topic* before yon so that you may know we 
bounds of the present discussion. 

The first topic is : Doei Iilam enunciate an economic 
aystem 7 If it does wat»i i* its form 7 and what place do land, 
labour, capital and management occupy in this form J The 
second topic it: Can the revenues ofZakat and charity be 
channelled into social weirar© work. The third topic is : Can 
wc set up an interest free economic order ? 

A detailed discussion of each of the above topics may m n 
into a volume. But koowiag (hat my audience is composed of 
highly educated persons, 1 shall only briefly touch upoo these 

Form of the Economic System or Mam 
, There are two parts of the first topic : Does Islam enunciate 

an economic system 7 And if It does, what place do land, 
labour, capital and management occupy in this form 7 

The answer to tht first part is that Islam does enunciate an 
economic system. This does not mean, however, that Islam 
has devised a permanent economic order complete in all details 
which may be valid for all ages. What it really implies is that 
Islam has prescribed such fundamental rules as enable us to 
con S iruci an economic plan suitable for every age. The method 
of Islam is, and careful study of Quran and Hadith makes it 
_ exp licit, that io the case of every aspect of life it sen up, as it 

1- (This addrtu *»■ delivered jt a Symposium in Ike Department of 
Administrative Sciences, fa®** Unlversi :> on 17 December 1965. 




wore, four corner, within which the affairs relating to that 
nspeet may be ordered. Transgression of these four corners la 
forbidden. Within these four cotters, however, you are free to 
settle the details of your life-order according to the condition, 
need and experience of your age. 

In all aspects of life, from private affairs to cultural and 
social matters, Islam lays down (he iamo role for the guidance 
or man. And the same rule applies to cur economic syetera. 
In the economic sphere also Islam has enunciated some rules 
and has set some bounds within which *e may construct our 
economic system. The details may be. as they have been, 
settled according to the conditions in every age. 

You will sec that wiihla the bounds set by Islam eminent 
jurist* had formulated rules of economic lire in great detail 
which ar>_ extant In books on jurisprudence. The economic 
codes complied by the jurists are derived flora (he basio 
principles of hlam and arc circumscribed by the li 

• bed by the limits set by 
(slum. Of the detailed rules framed by the Jurists, we shall 
retain such as correspond to our Deeds to-day. As far 
the new retirements or our own age we shall deduce fresh 
rules. These new rules however, will be essentially deduced 
fro.n the Islamic principles and will fall within the limit* 
prescribed by Islam. 
Objective* of Economic Organisation 

From tbe foregoing discussion you can ascertain the nature 
of tbe economic lystrm of Islam. Prior to setting out the 
economic principles of Islam. I would like to put before yon 
ibe objectives of the economic order of Islam, for Without an 
undemanding of tbe objectives, you can neither grasp the 
principles nor apply them to conditions or needs nor can detailed 
roles be deduced in consonance with their true spirit. 
A. ladifirfnalFi 

The first and foremost objective of Islam is to preserve 
individual freedom and to circumscribe it to such extent only 
as is coi pat.ble with commou good of humanity, islam puts 

that islam holds such person in hi, individual capacity as 

54 '"' SYSTEM OF iSl.KM 

b Z d r A U ' acc ° ttatabi, ' t y i* not collective, but 

, fol^w ld " 4 mustaasW " se P«^f- hi sacti0ns . Hence 
it follow that every p€rSon mntl ^ aff()rdcd 

opportun^y to real, 5 e his full poteotlal. Accordingly alongwith 
mor.1 aad polite, freedom. AXnS 

freedom of , Q e mdmdual, is curbed tbeif mora! and pomjj 
freedom .s also exterminated. You can fu ij y reali8 ; 
man who ti economically dependent on another n erso o an 
ii»tilut,oo or tb- government, caooot have freedom of action 
ever, if h= has an indepiodent opinion of his own Rcom 
Ialam CD nnciatei ,uch economic rules a* afford the maxim,* 
freedom 0 r economic activity to the individual, binding him 
only to socb limit* aj arc really necessary for s.fecuardmg the 
common good of humanity. That i» why 1,1a* eovisages a 
political system in which tbe government is elected by the 
people, who also have the power to chaoge it at will. T tie 
people or their accredited representative fun the affairs of the 
state Vxt nght of the people to criticise and voice their 
opinions 11 untrammelled. Tbe powers of the Government are 
not unlimited, tut are circumscribed by the overriding laws of 

the Quran aod Sunnab. 

Fortber in 1,1am Allah fa., vouchsafed certain basic rights 
to man which arc immutable aod Cannot be suspended by any 
human agency. All this is aimed .1 preserving the freedom of 
the individual and preventing tbe rise of a dictatorial system 
which may stultify the growth of human personality. 
II. Harmony in Moral and Material Development 

Secondly, the moral development of man is of funda- 
mental importance to Islam. 

For this end. it is accessary thai each individual in society 
should have the optimum chance to practise voluntary charity 
so that stniimeoti of generosity, aympathy, kindness and other 
moral virtues may become * living force in society. That is 
why Islam does not exclusively rely on the law to establish 
social juitice bat gives tbe highest priority to the spiritual 
reform of man by means of Faith, Devotion, education and 


Moral training. Mam transforms the taste and outlook of 
msn and generate* lo him a strong moral sense which may 
for ever keep him on tbe path of tight action. 

If alt these measure, fail, the Muslim society should be able 
to exert strong pressure on :fce individual to keep him within 
the prescribed bound*. When eveu such preisure fails lo 
deliver tbe goods, lafam resorts to the force of law to establish 
justice Every socpal system which relies exclusively on the 
force of law (o e *r a bli,h justice and so tie* up the individual as voluntary power to do good is un?ound from 
the Islamic point of view. 

(c) Cooperation, Aceotd »nd Establishment of Justice 

Thirdly. Islam uphold* human unity and brotherhood and 
opposes discord and conflict. Hence it does not divide society 
into clusses. On the oiher hand among Tbe classes that naturally 
exist io society, it promote! tyrapatby and cooperation instead 
of class struggle. 

An analysis of bvmM society will reveal to you tbe 
existence of two types of classes in it. O oe type of classes arc 
those which are artificially aad unjustly created and forcibly 
maintained b, vicious political, social and economic systems. In- 
ibis category foil the classes which were cteated by Brahaman- 
isra, Feudah im and tbe Western capitaliit system. 

Islam creates no classes of this sort, not envisages their 
perpetuation but eliminates them by its moral and legal re- 
form*. The 'econd type of classes are tho« which form and 
dissolve in a natural marine by difference! in abilities and 
conditions of human beings, islam does not out these 
classes by force, nor transforms them inlo/i B id classes, ooricts 
ihem against one another. 

On the other hand by its moral, political, social and 
economic programme, it promotes just cooperation among 
them, makes them the sympathiser and ally 0 f one another and 
by affording equality cf opportunity m all creates such condi- 
tions ifl which these classes conMnue to dissolve and change in 
a natural manner. 


Basic Principles 

Aa awareness of the above ibr** - 

' U " F ' n -- 1 "°* Pr ° C " d w ««< > ~jo r pr'n dpi a - 
of this economic system as follows : ' ' 

Prime Property and it, l imits 

Islam endorse, individual ownership of property subieci, 
~ sp eci a, condition,. a„d in .h«««or ind^Zl™^ 
" (,0CS n °« «"*«n<i.le between Mean, of Production ~ 

co D , unier Good, aad ElIM- 0r Uota[ncJ lncom "7^;; ° 

0 man a seneral tigbl (0 bold p oL Z't'Z 

d'ffc , flT ,h " MMOi ° f Paction should 0 S 

tO consumer goods h , li(n , 0 UUa ,„ !» P « -™*.p 

j«i as a person can p0litn clotnM . u|cflsil5 .E'"^™" 
A» «r.. .0 he can OWD ,« Bdi ^ factor! X 

By ih. .am. token just as , parse i. tte rightful owner of 1 
direct y earned so he can ju s, ifi . bI) . p0 ™ ' 
mher.ted ftoai hi. parents or spouse and can .hare «7, n « 
or 5 leep 10 I P«< in , ne earning, of , 00ther B „E".^f 
venture he has ln vested h, 5 capital. 0 >»™ "» whose 

islam d«a nol differentii,. between 0 „ 
properly in terras of whether it i, » M ,m. !r „ j " 
consumer commodity or m LL- t ^1111''°° ' 

1LT r " " c, ""« dividual shoojd enjo, freedom ia 

ssr„ 1 tav - - «« f-dootor ,n. 

• P ™ if! ' ,0 <"'-*■ <""'>•* w .Sis freedom 


ownership is curbed and all economic means are taken under 
public control, individual freedom becomes extinct, for all 
individual* ibeo become employee* of that institution which 
esercises monopoly control over all the economic resources of 
the state. 

Equitable Distribution 

Another important rule of Islamic economy is to establish 
■ system of equitable Tather than equal distribution of wealth. 
Islam does not envision equal distribution of economic resources 
among individuals at all. The student of Quran is bound to 
realise that no two ihiogi are equil in ibe universe - 'equal 
distribution ii so unnatural'. Have all individuals been endowed 
With IhC same de«rce of health? Are all individuals blessed 
with the same level of intelligence ? Do all persons have 
equally strong memories ? Are sit persons equal iu beauty, 
strength mod ability? Are alt persons born under the same 
conditions and do all of them work under tbe same set of 
circumstances t If equality in such things is non-existent, what 
meaning can equality in the means of production or distribution 
of wealth holds ?. 

This is virtually impossible and whenever artificial equality 
is sou Eh i in he established, the attempt will inevitably fail end 
will entail vicious consequence*. Hence Islam doei not enjoin 
equal distribution of economic means and products, but orders 
equitable distribution and lays down certain regulations for the 
maintenance of equity. The Drat regulation is that Islam sets 
Up a dii lint-lion between lawful and unlawful means of income. 
On the other hand it concedes the right of free enterprise to the 
individual and recognises bis right to keep the lawfully earned 
wealth. On the other hand it baa drawn boundary lines between 
lawful and unlawful wayi of earning wealth. In Islam an 
individual is absolutely free to ears his livelihood by lawful 
means. In this case no restriction is imposed on him as to the 
methods he adopts or the amount of wealth be earns- An 
individual is the rightful owner of his lawfully earned wealth. 
No one has tbe right to put a ceiling on his lawful possessions 


or appropriate tbem. However no Individual has the right to 
own a grain or what has come to him through unlawful means. 
The individual will be forcibly prevented from obtaioiag illicit 
earning*. He has no legal title in such earnings. He shall bo 
punished with imprisonment, fine or forfeiture according to 
the nature of his crime, and deterrent measures shall also be 
taken to pr&veat the incidence of this crime. 

The means declared unlawful by Islam are These : misap- 
propriation, bribery, usurpation, embezzlement of Public 
Funds (from Bait-al-Mal). felony, spurious weights and 
measures. Business which promotes immorality, such as 
prostitution, manufacture and trade of wine and other intoxi- 
cants, usury, gambling, speculation and all forms of sale under 
false pretences or duress, or which give rise to dispute or 
friction or which are derogatory to equity or public interest. 
Islam curbs these means by force of law. Betides, it bans 
hoarding and prevents the formation of such monopolies as 
deprive the common public from availing of wealth and the 
mean* of its production without reasonable cause. 

AH wealth which a man rants by means other Lhan those 
listed above is bis lawful property. He can avail of this lawful 
wealth personally. He can transfer it as gift or reward to some- 
one also. He can iovest it in some enterprise to earn more 
wealth and can leave it as inheritance for his heirs. There i* 
no ceiling on tail lawful wea'th which curb its further growth. 
If a man has the potential to become a muni -mi II ion a ire by 
lawful means, IsEam does not stand in his way. He can make 
as much money as he likes, provided he dues it by legal means. 
The patent fan is that it is not easy to pile up millions by 
rightful means. He is a doubly blessed person who earns 
millions by • impeccable means, otherwise ordinarily there ij 
little room for anyone to become a millionaire by honest means. 
The fact, however remains that Islam places no restraint on 
anyone. A man can earn to the maximum provided he does so 
by lawful means, islam places no hinderance jo the way of an 
honest mao, for undue restraint suppresses incentive for work. 


After all this, the use of lawfully earned wealth is agairi 
subject to certain conditions. 

As regards personal eipeose, UU m lays down the condition 
lhat il should harm neither the molality of ihe person himself 
not jeopardise public interest in general The individual is 
not allowed to drick wine, or indulge in fornication nor i $ he 
permitted to fritter away hi* wealth in gambling. He is absolu- 
tely foTbidden to have recourse to any form of unlawful 
pleasure. He must not eat in vessels of gold and silver. «o 
much so That if he adopts an abnormally high sijle ofliving. 
checks may be applied against him. As regards saviug a 

portion of oae's wealth and wnbholding it from circulation, 
Islam disapproves or it. 

Islam enjoins that savings should be put inla lawful chan- 
cels of circulation. 

Upon individual holdings Islam imposes Zakat under a 
special law. so that a portion or such holdings is compuhtorily 
traasferred to deprived sections of society and public icrviees. 
Upon atudy you will find that piliag up treasures is one of 
those practices which have been most vehemently denounced in 
the Quran. Treasures or gold and silver built up by the people 
wilt be used to btund them in hell, says the Qurau. This Is 
because Allah has created wealth for the good of mankind 
So no one has the right to store it The right course is to earn 
by lawful means, spend on one's legitimate needs, and put the 
savings into lawful channels of circulation. 

For this same reason, Islam forbids hoarding als.>. Hoard- 
ing is denned as wilful storing up of floods with a view to 
creating shortage and raising prices. This i< hanned by Islamic 
law, A man should trade in a l air manner. If you have stocks 
fur sale nod there is a demand for them in the market, you have 
bO rational cause to withhold their saJe. 

Wilful hoaftng with a view to creating short age turn* a 
trader into a robber. That is why islam opposes the creation of 
unfair monopolies, for tbey prevent the access of common people 
to economic resources. Islam forbids the reservation of certain 


economic opponuritie* or means for a few privileged individual* 
famihei or ar.d debarring others from av*lZ t*t 

opportunities or means, -railing tocee 

Jf at ail any kind of monopoly is held lawful hu r.i.*. • 
.bat which is absolutely essenTiaJ for s cw^/pu^c '1" 
Otherwise I*, keeps :he fie | d of CCODOfflIC ™ V £ n t ^ 
aiding maaurum scop, so individual enterprise. If „ 
dual w.shes to pm his swings t0 work, he can unly do so in »■« have beer, approved by Islam. Unlawful means as indicated 
above caonoi be used 
Social Rights 

VOU will find in the Qaran that the rights of kindred have 
been mcnt.oncd. Trm that apart from himself his 
relatives too have a C )au& on bis personal wealth. Each member 
of the society *ho possesses *irplu* wealth it individually 

according to bis meant to 
such of his relatives as caonot obtain adequate livelihood If 
each family in a nation realises this duty ail families would be 
proved for and . f*muy needing external assistance woufd 
scarcely be found. That is why under the head of JUJIjU* 
Rights of Man, the Holy Quran accords the foremoBt place fa the 
rights of parents and kjndred 

Similarly the Holy Quran impose* ibe right of neighbours 
upon an individuals' wealth. Thi» implies tbat the affluent of 
each locality, street or ward are unde. an obligation to support 
the rcUtivery (ess roriiimre and indigent families of the ianje 
area. Next to these t*o obligations, the Holy Quran puts every 
well-to-do person under an obligation to support to the best of 
bis means anyone who solicits or needs his assistance : 

"The supplicant { Jlu ) and the deprived has a right on the 
wealth of people (Al-Qor'ao) 
The J- U is onc who solicits your help. It does not mean 
the professional beggar. It refers to a genuinely needy person 
who sole* your askance. Before lending Stance, however. 



you musi verify that his need i* cenuin* l«a fi • 

known lo vou that he h« rijht oa your w W Hh. 

A* for the deprived, a fC f c , 5 to a person who does not 
solicit your inmaBcc, hut abuut whom you know that 

: a T'o°n m " m »J J' This pc "oo. „ C M 
^ on your W e a nh . IJciule.ihwer^u.w^ hM , 55ueJ fl 

general injunction [o Mualinn (u ,r foJ iri , h ^. v ,„ ■ f . „ . . 

wcal.h. The purpose of this iujunciion i, ,„ iBeolate ,„ „ 

Mioo and ph,l, n ,]„ opy . Nol „ llt cf K|f , !h niol . ic ; 

w.nniug the good»,n of A n„ h alone, a Mnslm, should generally 

,7 " 'V" W °' 1 " ° rC0, '" aOn EMd »" d 10 »k?v 

*hich h h society. TJm-.ucncndouS mora, spirit 

™ , "y cocrcwa but by free-will he sboulo „„. 

mote lbe common good of society 

N«t to thi, voluntary speodiog. then « another compulsory 

Produce, a/ d cat,,. V pu ^ ^ ™ 
suprort of economically depressed cl.,s«. 

footiln^ v W ° k^ " d, , °1 Sptndi " S ,re ""parable to ■*»/«,/' 

off« A ■ T >IW < 0Ni »"»y» You c 00 

offer Ntfel Na,,,*: » „, U ch 0! M , iItte „ Th 

ItLT Na !" t Njin " «»M <*«■ But Faraz Nana* is an 
tcnSr™ i, y °? T P " f °" n - Tt * '» ** ««• with 

perform, provided that your wealth tlc « ds [bc sl3tuorv llnj!t _ 

^JVi U JT d ' Sa , bUS ° y °" ""i" 1 «' 'he notion that Zak at i» 
"me kind of tajc. |, it noI , w , (0iIn of dcvolioDi |n facj 


iUce Namaz, it is an important article of faith in Islam. The 
conceptions of Zakat and the Tax are poles apart. Tax is levy 
.orcihty imposed on a fwrson and the person " on whom it is 
imposed may not necessarily like it. The tax-payer is not the 
diac.p|e of the tax-collector, nor docs the former believe in the 
righteousness of the ialter. 

The payer considers the tax as an exertion, resents it and 
resorts to several devices to dodge it without detriment to hi* 
faith Again the basic difference between the two is that tax is 
imposed to meet the expense of public seivice* i.e. the payer 
receives iome benefit in return for the tax: The fundamental 
idea behind taxation i', that if you demand the provision of certain 
services by the state, you should pay to the state a proportionate 
.rate on your wealth. This tax is a sort of subscription which is 
exacted by force of law for the provision of Public service of 
which you are » beneficiary, lo contrail tu this Zakai is a form 
of devotion, much like the Namaz. ft is levied by oo act of 
Parliament of Legislative Assembly, it is imposed by Allah, 

Whom every Muslim acknowledges as his rightful Deify Any 
man *ho wished to preserve his faith cannot resort to evasive 
tactics or cheating in the payment of Zaxat Indeed even if 
there is no external agency to awcu and receive Zakat from him, 
the faithful will personally assess his Zakat and pay it volun* 
tarily. Again the revenue of Zakat fund is reserved Tor those 
classes only who for cause or the other, have received little or no 
share from the common wealth, or are deprived, temporarily 
or permanently. 

In its natural basis, spirit and form the Zakat is quite unlike 
the The Zakat fund cannot be channelled into road, rail or 
canal huilding or administrative account, but is meant for ful- 
filling ue rights of specialty deserving persons as an act of 
worship ordained by God. It is one of the five articles of faith 
m Islam and no benefit of Zakat save the goodwill of Allah 
and reward ia the Hereafter can accrue to the donor. 

Some people suffer from the illusion that there is no tax in 
Islam s »vc Zakat and (Charaj (jaod tax) . But the Holy Prophet 



{pence and blessings of Allah be upon him) h» clearly decl- 
ared : 

"There is a claim on the wealth of the people above and 
beyond Zakai". 

At a matter of fact the (axes abolished by Shariat were 
those which were imposed by Caewrs, Emperors and their 
nobles in order to fid thc ir perianal coffer aod for the receipt 
awl espen^e or which they were accountable to nobotiy. A* 
for those, taxes which a Government run on the principle of 
Shura (i.e. a govarnmf nc in which deLiaioni are made in consulta- 
tion with an advliory council) levies by popular consent and 
advice ; the receipts <if which are deposited in the Public exche- 
quer to be spent In consultation with the people for which the 
Government it accountable to the public .. - for tbe imposition 
of such taxes there is nn bar in Shariat. If prior to the 
eHtsbl'whment of the Islamic Government, there exists fa society 
an iniquitous clan system, or some classes have grabbed exor- 
bitant wealth by unlawful means, the Islamic Government can 
remedy these ilia by levying taxes rather than resorting to con- 
fiscation of Properly. The Government can also put in force 
other Islamic Jawx, to break the concentration of wealth, 

The resort to confiscation of Property necessitates the dele- 
gation of such autocratic powers'whicb once given cannot be 
limited. Thus one tyranny is succeeded Sy a worse one. 
La* of Inheritance 

In addition tothix. Islam has also enacted a law c-f Inherit- 
ance which purports to distribute the estale of the deceased 
according to a fixed rate over the widot potxiblc circle of inher- 
itors. The first line of heirs to the wealth of a deceased person 
are his mother, father, wife 2nd children. Next come hid- 
brothers and sisters. In the third line stand the close relatives 
of the deceased. 

If a man dies intestate the whole notion is his heir and h'is 
entire estate shall be transferred to tbe Public exchequer. 

These then arc the principles and laws which Islam sets 
down for tbe ordering of our economic life. Within the scope 


of (ho» r aw$ y 0ll oay d5¥ise f economic mtem 

T h ,worL ?flUt0 fd ct a llSis left to each 
totim* a? d a«J. The essential cond.iioa is that neither 
/ai"cap;tabsm oor Comtnunbtic porgramtre of total national- 
ization 'rfwooom^BWiittthoiiidbeadiipteii. We must devise 
«*r-lan»-Krssdatcdfref economy in which the door* of the 
mora. tifivj.opacBi of man « left open, and in which there is 
Jc«« n «d for l^ flf rnfa!lirc , to induce the individual to cootri- 
bufe tc Pu,-:;, ; ood ; m which tbrre i* no room for the growth 
of L«na!ura ; by unjust means ; and in which the relation* 

eoiooj; naturnl classes .re -based on cooperation rather than con- 

In this system .1] means of earning wealth pres- 
cribed b> Win ,i«H be declared illegal and ai | means of earning 
wealth approved by Islam si. alt be declared valid under law, 

All right; of ownership and use of lawfully earned weaitb 
which hav« been reeoBniied by Warn shMl! be enforced Zakat 

shall be^ diluted in accordance with the law oflnhS? 

Within these bounds the individual shall be allowed full 

" - ,0 ? iC " deaV ° Ut - Nos >»^^««1 « regimen- 
al."" and curtailment nf iadividu.1 freedom shall be devised. 

bride: cbn >v ir em of free economic enterprise if individual* 
aune« * jusii™ and fairpUy. the law shall not unduly inter- 
fere with tnem. But if They do oof act justly or flout the law or 
«efc to establish unfair monopolies, the law will "inevitably move 
against them, not to forfeit their fundamental freedom, but to keep 
them o 3 the track of justice and prevent them from exceeding 
the bounds. 

So far I have replied to Ibefirat part of the quEslion. Let 
us turn now to the second part viz. the role of land, labour, 
capital and management in this scheme. 

The Role of Labocr. Caplftl and Management 

To gain an understanding of this subject I would advise you 


<« «ud» ,„e T«.„c, and Patlatrahil , Uw , ujiyeo in (he bookj 

CDiS'-nll 1 n" 11 "™ " U ' h0 " 110 "° t di5CU!s Land - «-abo U r, 
otat.. H " "onorair f B ct ora as modern econ 

ia .h, ^"V"" ^ *** und " copter, 
£.< of ^ ° f F ' qh - in * *»'ch i. dilflereot Lm 

and prohlem, of economy will readily comprehend the economic 
concepts contained in the texi-bnoks or bd.rotc Fiqb Tlic 
tenancy and p.„ n cr,hi p 15 cmlnci;!led ^ , he ^ 

Coot"; ?M ' he ^ Vicw P° inl - L,nd. Ubour 

fhrt h h Managra "" can " )lt,d r «PlWt. Tenaacy denote, 

prom. The manner in whkh i 0 thc « fraction* wl " 

; >ther dear* B *ow, that J«i-m reg.rd, both Lnd ud human 
fubour as economic factors. "'"nan 

2«l aI -7 a " cwn6mic feclor and 50 are hlim « n 
2E Z^'i , EjCh rf'fc««too ni «ti(k. * share in 

the law should not™ rfd ■" c !* '" C ." ,ef ac «" Sin S "> ««»te. 

SHo^^ 7bf ^; b 7 re ' r 1 thc IDi ' 01 '" sc " 

However *if UT'-^ "" J nn ' in,erftre >• ny bus ne,, 
'"""'.KIW-^,,*!,, b» the ,o intervene! 


The law can set down rules and regulations of Tenancy, so that 
neither tbc rigbt or the landowner nor the right of the labourer 
it infringed. 

Likewise in commerce as iong as ir am actions are made be- 
tween Capital, Labour and Management on just principles and 
do one is usurping the right of the other or dealing unfairly with 
another, the Law shall not intervene. However, if unjust prac- 
tices creep into these transactions, the Law has not only the 
right to interfere but is duty-bound to frame such equitable re- 
gulations for the distribution of Pro6ts among Capital, Labour 
and Management. 

Zakat and Social Welfare 

Consider Lhe second question now i.e. can the Zakat and 
Sadqat funds be channelled into projects of social welfare. 

The answer is that Zakat and Sadqat revenues are meant tor 
social welfare. However, it must be borne in mi nd that If by 
social welfare is meant the expenditure of Zakat revenue on the 
economic development of the country as a whole, Li this unlawful. 

Zakat fund, as I have said above, it in fact meant to 
provide the necessities of life i e food, dress, shelter, medical 
aid and education to every citizen and to supply the economic 
needs of all those in the society who are either unable to 
cam their livelihood, i.e. orphans, the old and the disabled, or 

those who cannot earn their livelihood due to paucity of mesas 
or those who may by enabled to stand on (heir feet with little 
help, or those who have suffered some setback. 

Zakat has been established to assist (he above-mentioned 
categories. For general economic development the state must 
find other means. 

Iiterest-free Economy 

The third question put to me is: Can we establish an interest- 
free economic system ? My answer is that we certainly can. 
This system has remained in operation for centuries in the past 
and if yon resolve to establish it today and renounce loyalty to 
foreign doctrines, you will got find the task too difficult. World 
wonomy operated on interest before the advent ^f, [slam just 


« it docs today. Warn altered this economic system and 
abolished interest, interest w „ banQcd fint u Afabia L 
whichever land the reign of Man, was established, there uaury 

7°\ H?"? !!l e8al *" CC ° QO * ic m operated 

for hundreds of yean and there ji no re« 0 n why it should not 

workflow. If »» poises, the ability of ///^(enlightened judge- 
ment), have the power of faith and the will to abolish what God 
b« forbidden w» cm ccriaidy run our monetary md economic 
system w,thout interest even today.- I have elaborately expla- 
ined in my wort 'Sood' that there is in fact uo terrible difficulty 
in the attainment of this goal. The problem is clear and simple 
The capital has no right to asruae the form of debt and exact a 
fixed rata of interest, regardless of whether the workers or manage- 
ment gain any profit or not. The real defect fa Sood lies in the 
fact that a person or an organization advance, capital in rJte 
form of . loan to bduitry, trade, and agriculture and settle, a 
rare of interest io advance. The creditor has oo coocem with 
the profit or lose within the emulated period or with the rate of 
profit if the venture isrwotagi. profit. The creditor receive, 
the Hind rate of profit month by month or year by year and 
retains bis claim on the capital. It if this practice that we wiah to 
abolish. No one in the world can justify it on rational grounds. 

"E"raont can prove hs validity. Id contrast to this the princi- 
ple enunciated by Islam is that if you advance a loan, you are 
entitled to receive the capital only and nothing more. But if 
you wish to secure profit, you ahoufd enter into straight partner- 
■rnp or become a shareholder. You should inveit your capital 
in Agriclture. Trade or Industry on the condition that the profit 
sbaN be divided between you and the entrepreneur according to a 
fi«d ratio. This is what justice demand, and this Is how econo- 
mic life can prosper. What obstacle is there in the way of 
atwiishjog interest and enforcing this alternative practice. The 
eapiial now advanced as loan should henceforth be invested on 
partnersb.p basis- The profit accounts may as easily kept as the 
interest account. There Is no special difficulty in respect of 
blind accounting. 



The problem is that wc Jack the capacity of tjiihad (enlight- 
ened judgement) and blindJy follow precedents established Id the 
past, rather than seek oc* solutions by the exercise of tjiihad. 
The poor MnUa is blamed for blind imitation and total lack of 
capacity tot Ijtihad, yet the fact is that it is the laity who are 
blind and unprepared Tor the caercis* of tjiihad. 

Had this malaise n ot crept into Muslim society, the problem 
would have been solved by now. 

Correlation among Ecooo-nic, Political and Social Orders 

The final question is: What according to Islam is the cor- 
relation among Economic, Political and Social orders? The 
answer is that the correlation among these is the same as among 
the root and the trunk and the branches, and the feives It 
« a single system which arises from faith in the uoiiy of Allah 
and the prophecy of the messengers. The moral system the 
system of worship* or the religious system as you call it. 
the social, theecoDomic and the public system-all these sysfemi 
form the same hub. TTiese systems are indivisible and form one 
organic whole. If you believe in God and His Apostle and if 
you are convinced that Quran i, the Book of God. then you will 
juevitably adhere to the same moral principles which hlam 
teache? and Follow (he same political rules which Islam enun- 
ciates It is on the foundation of the* principles that you will the edifice of social and economic life. The same fVtfa 
which impels yau , 0 say prayers aiso bind, you to conduct busi- 
ness according to its dictates. 

Th; religious code »hich regulate* fasting and performance of 
Hajj larso governs the judicial process aD d the affair of the 
market place In Islam the religious, political, economy and 
twial systems are not separated entities, but are organic part of 
the Same whole. I Q lhc absence of faith in God and His 
Apostle m the Last Day and Id word of the Quran, the establish- 
ment of Islamic polity is oeitl^r possibfe nor workable. The 
base of the political system of Islam is the belief that God is the 

Z-T**' 1 ?* Apo,lle HiS ™ s "»: ihc Deer* 
which mast be obeyed ; and all of u* in the end are accountable 

rUNCtpto awo oaiBcnvcs ot bconomic yji 
«° God Hence ii » 0UId be Ul^ou l0 cuneeive ,„„ in lsIon , 

Anyone who ha. .tudicd.I.Uia and ha, an edighJeoed belief 
d» W c, al ed from R | or tfc.t , , vrt e m rf lifc in which |ui . 

5 °" oa 10 r "* m is «"» "» ™ 

Islam and Social Justice 1 


Falsehood under the Cloak of Blsfateoufnes* 

One of the strongest wonders of ihc lofty scale oq which 
Allah has crested man is that man is seldom inclined towards 
open sedition or unveiled mischief. Satan is. therefore, oftea 
obliged to set his prupoial of sedition and mischief before 
man in the guise of goodnesi and virtue. la Paradise Satan 
could never have deceived Adarn (peace be upon him) by openly 
admitting la him : "I want you to rebel against God so that 
you may be expelled from Paradise." On the contrary Satan 
deceived Adam (peace he upon him) by laying : 

"Come! Let me show you the tree of eternal life and 

eveilaitiog kingship." (Surab Taba : 120). 

From then to now, man's ■■tore bat remained unch-nged 

Even today all the errors and blunder, into which Satan Is 

leading man are winning popularity and acclaim because of 

deceptive slogans and because they are cloaked under'a false 

Delusion No I - CapliaJiim »d Secular Democracy 

A major deceptioo among ail these is the promise of 'social 
justice" which U beiog held out to humanity in modern rj mC5 . 
For a long Hme before this Satan hai been playing a fraud on 
the world in the name of 'Individual Liberty' and "Liberalism 1 
and on ihc basis orthcie doctrine* Satan inspired the establish- 
mens of capital urn and secular democracy in the 18th Century. 
There was a time when the capitalist and secular Democratic 
Order had cained such ascendancy over the intellect of man 
that it was c onsidered as the a cme of human development and 

J' *J*£ V lKle w " read " "he Ccogren el 'Motam.r Alam-i-Wim" 
1W 1Z C ' iY ° r °° "* ° f H * U U,, * H *™"»*'« <• 



every ruan who wished to be known as progressive was obliged 
10 chant the slogans of 'Individual Liberty' and 'Liberalism', 
The people believed* lhat if there ever was an idea! system of 
human life, it was capitalism sod secular democracy as estab- 
lished in the West. Soon, however, a stage was reached when 
the whole vorld came 10 realise that this diabolic system had 
filled the world with tyranny and oppression. After ihat it 
became impossible for the cursed devil to deceive mankind 
with these slogan* anymore. 
Secoud Delusion— Social Justice and Communism 

However, it was flat long before the same devil reappeared 
with a different trick in the name of 'Social Justice' and 'Com- 
munism* and under these chimeras be is now b<j*y establishing 
a new system. This new system baa by now plunged several 
countries of the world into a state of such great tyranny that 
past history faiJs to produce an e«;ual 10 it. Yet this system 
has such a great potential for deceiving maultiod that many 
other countries are preparing 10 embrace- the fraud, believing it 
to be the ape* of human progress. Todate the fraud has not 
yet been fully exposed. 

Extreme Intellectual Si-very of ibe IntelHgeddla 

The position of the Muslims is that they possess an eternal 
and everlasting guidance in the form of a Divine Book and the 
Suoaa (Precedent) of Allah * Prophet (peace and blessings of 
Allah be upon him). This guidance is sufficient to warn them 
against the doubts 10*0 by Satan and is enough to show them 
the right path in all affairs of life till eternity. But this group 
of intellectual bankrupts are ignorant of their own religion and 
hava abjectly surrendered to ibe cultural and intellectual 
of the colonialists. Hence each slogan which rises from the 
camp of the world powers is immediately echoed by this group. 
In the period when the ideals of the French Revolution held 
sway» every educated person ia Muslim countries fell duty- 
bonod to pay lip service to these ideal* day in and day out and 
endeavoured to throw himself into their mould, for he feared 
that if bo did not do 30 he would gain no respeel and wouJd be 
condemned as a reactionary. When this period came to an end 



and the old era gave place to the new, the centre of devotion of 
our modern intellectuals shifted ground and tbe votaries of 
socialism and communism spreag up among us. Things were 
within tolerable limit* upto now. But it h outrageous thai a 
group among us bss always risen with tbe demand thet each 
time they change their centre of devotion Islam xhoold also 
transfer id devotion to the same centre. In other words, these 
miserable watts cannot live without Jslam. They must keep 
Islam in toe. It ii their wish that Islam should" rid itself of the 
charge of a reactionary religion by adopting those ideals which 
they have embraced to achieve 'progress' ia the world. It was 
on this basis fhat effort were made formerly ro prove that tbe 
western doctrines of 'Individual Liberty', 'Liberalism' and 
•Secular Democracy' were in consonance with Islam. It fa on 
tbts basis again that they arc making efforts to conclude that 
the communist doctrine of social justice ia contained in Islam. 
At this point, the intellectual slavery and the scale of their 
ignorance loaches the ultimate limit of depravity. 
Jne Real Nature of Social Justice 

In this brief article I wish to explain the real nature of 
Social Justice and the true form In which il can be established, 
even though there is very little bo P e that those who axe beat - 
upon enforcing the ideology of communism, believing it to be 
the only form of SociaUustice, will ever admit their error and 
jura towards the true form of Social Justice. For as loog as the 
ignorant wallow la their ignorance, the possibilities of their 
reformation and correction remain open to a large extent. But 
when an ignorant person comes into power, the illusion 'No one 
knows more than I' renders him incapable of comprehending 
any advice. But by the grace of God the common people arc 
always amenable to reaionable warnings against the traps laid 
by the devil. But the misled and the misleading elements 
promote their errors by deceiving the same common people. 
Hence the purpose of my article, in fact, is to explain the reality 
to tbe common people. 
Social Jostles is found ja Islam only 

In this regard, the first point that I wish to impress upon 

isia* and jocm joanc, l03 
my M^liffl brother, i« lnat lhe p^,, WB0 „,„ ft 

, ' The correcI <"aw«K« would be "There ■» Social 

Just.ce ,„ 0D „... , codTJhiftat 

* I 1 " iTd 'V* s 

Je erm T n T ° j««icc amor* n,e n aod ln 

Jeierroioe whit i. jmi and wh»( is uoiuii is ihe n r.r„ . . . 

b.s Ibe io determ.oe lhe scale of justice .„d ,v r .„ nv 
:;„" •»""- ^ blc ° f ""Wirti,, true Uc, Mar!" o„i 
b.s own master 0f ru ierth« he should ererci>e the thorny of 
devi..D| a scale of iu„i C e for himself. MW, p 01 ,„o n i„ the ib* «,„ of M.tie. doe, BO t li. in bis power bui I. 
«. prcr 0g .,i, e of h „ Masler and Role,. A,. l0 even ,f . 

kaowledg, „ all t.nw. remain, triced oy IcveraJ ' 

prejudice o r b,., up 0B 0UBUn „„„ „ m 

t*» ,h.l „. „„ .ueceed io evolvio, " Z£ 
bi.ed o 0 JB „,„. A system «, olvtQ - by „„ ^ em 
jus, a. 0 .per, but practical ejpe.ieoc. ,ooo uncover, the JoLl 
found,,,™ UP0B W h,ct i. ,. based. For this reason eve"y 
Mqiin, af.«r being i„ f orc , for some time, i. ultima- fo BB d to be defecti,. : .„d f « liBg djigu5ltd w ; ih ™ 

proceeds io l.uech aoo,be t foolish e.pcrimenl. True jusiicc may 

uVT " imed b ' lbe UDi "° ™» «"« 

toe Fair and the Holy Being. 
Juslice ii tbe only Obj«(l»c Of Man, 

- M ^ B ° lb l! r point * hich muat be « r, *-* d ai the outset j 3 lna t 

- perjou who say 'The f e i, Ju»i C c in I.lam' sptikt |«s than the 

-nd the rcvclahon of Warn hai DO oth „ pur p08C lhan w 

caiabliah justice. Altah afflrma : 

*'We scot Our Mejienscn beariog token* aa a 
We scni the Book and ihc Scale with them so ra ao 



should stand on justice antf Wc sent iron which has 

great srrengib and has many uses for the people so lhat 

God may ascertain who. without seeing, follows Him 

and supports His Messenger*. Surely, Allah is Strong 
and Powerful." 

These then are the two points which if a Muslim were to 
keep in mind for ever, be would never leave Allah and His 
Messenger (pence and blessings of Allah be upon him) and look 
for other sources in his quest for Social Justice, The moment 
, man realises the need for justice, the truth will dawn upon him 
that no one carries or can carry justice except Allah and His 
Messenger (peace and blessing* of Allah be upon him), and, 
finally, he will come to the conclusion lhat in order that justice 
may be established nuthing eke it done except to pro- 
mulgate Islam, total Islam. Islam without adulteration or distor- 
tion. Justice is not a separate entity from Islam. Islam itself is 
justice. The promulgation of Islam or tne establishment of 
justice is one and the same. 
Social Jnttice 

We must deal with the question now as to what is the real 

nature Of Social Justice and what is the correct form in which it 
may be established ? 

The Development of Human Pmoaality 

Each human society is made up of several thousand or many 
millions of human beings. Every single member or this com- 
posite whofc is endowed with spirit, reason and sense. Each 
individual has a permanent personality which requires opportu- 
nities for the full realisation of its potential. Everyone has 
individual taste, some inclinations and yearnings of the soul, 
some needs of the body and spirit. These individuals are not 
mete static nuts and bolts of a machine, required only to keep 
the mechanical monster in running order. On the contrary, 
human society is a corporation of living human beings. The 
individuals do not live for society ; the society lives for indivi- 
duals. And individuals combine only to procure needs and 
satisfy the demands and instincts of their body and soul with 
mutual assistance. 


Individual Responsibility 

Agaid each one of these individual* is personally responsible 
to God, Every iia gL c pc ROn oajto ^pj^c a Cfrtajn period or 

trial tthe duration of which is specified for cacti individual) in this 
world and then has to render accounts in the court of Cod as to 
what did he make of biiwdf with all the power, and gifts he 

was endowed with and the means which were furnished to him. 
This accouii lability or man to God is not collective but individual. 
Family, tribes or nations shall not be made to stand in the 
■lot* collectively. God shall lever every man from all connexi- 
ons and call him to account separately for his personal deed* in 

the mortal world as also the stale in which he ha* entered 

Individual Liberty 

These two points-rhe development of human personality in 
the mortal world and the accountability of man in eternity— 
demand freedom of the individual ia this world. If an individual 
cannot find suitable means for development of his personality in a 
social environment, his inner humanity » frozen, he suffers from 
aspbixia, Ms powers and talents ace demented and finding hiimclf 
a helpless prisoner of the <cocial circumstances hefa]| Saa easy prey 
to stagnation and corruption. Moreover.- in tbe eternal world 
the responsibility for ibe sins of these helpless and Suppressed 
people in most part shall rest upon who have devised and enforc- 
ed thin tyranny, not only win they be called to account for their 
individual deeds but they shall also be held accountable for 
imposing a ruthless system, thereby forcing the unwilling masses 
into becoming defective characters. If is evident Lbat in the end 
no righteous person can ever IhinJc of presenting himself before 
God w ; Ui such irt oneruus burden laid upon his shoulders If he 
U God-fearing, he shall certainly be inclined to grant tbe niax- 
iraum liberty to individuals, so that each individual should 
develop on his own responsibility, thus acquitting tbe executive 
authority in a soicarsystern from any blame on account ol 
the delinquent character of a member of the society. 
Social iBslltatlons and their Aothoriry 

So much for the Individual Liberty. Let us now turn our 



ga« towards the society which evolves stage by atage from 
families through tribes aad nations itjto the whole of mankind 
The genesis of this society is ihe union of raaD with a woman 
and their progeny which make op a family. Many such families 
form a tribe or a clan, which in turn combine Id found ft 
nation. The natiOfl, in order to enforce its collective will 
cstibliibes a Government. The real p U rpo« for the existence 
of these social institutions in their various forms is that the 
individual under the patronage and security of these institu- 
tions, should avail such chances for self- imp rove me Dt as he 
canoot obtain on his Own. But lh i, fundamental objective 
cannot be achieved without ensuring that each institution 
shon d power over ;be,ndividual and the big institu. 
Hon jhould control th«: smaller institutions in order that (It 
they may prevent an individual f:om eroding the bounds of 
bis liberty and violating the liberty of another individual (2) 
they may obtain such (ervice from individuals « „ reqc'.red 

for the well-being and advancement of ill members of the 
society. This is the stage where we cohfroot the question of 
•octal justice an d conflicting demands of individualism and 
collectivism assume the form of a tangle. On the one hand 
human welfare demands that the society should allow the 
indivdnaUVeedom to develop his personality in accordance, hts capabilities and ideals. And in the same manner, the 
famify, tribe, clan and various groups should enjoy such liberty 
as is absolutely necessary for them in their own sphere of 
activity. But on the other hand human welfare also demands 

that ihe family should catrcise authority over individuals, the 
tribes and clans over families and finally all Individuals and 
small institutions should come under state control so that 
none ef them may exceed its limits and subject the other to 
tyranny and oppression. Proceeding further we come across 
the same problem in re|at:oo to the entire humanity. On one 
•ide the liberty and sovereignty of the Nation and the State 
must be preserved, on the other it is imperative that there 
should be superior Authority to regulate the inter-state a D d 
iniei-aaiional affairs so that the nations and states may not 


wceed tbcir bounds. 

Now the real «ui»L a « of ,ocia| justice h thll _,. . 
div,du3ri, families, tribes, daw. nation shouM III 
tenable mea SU re of freedom. Si .ulU^oos"' to ^ " 

& a ° d , V f ° f ° {H "' % liBhTa 

n ,k , d 'I" 01 " COOU01 ° V " - In over 

«wr ° lh r r ; o V l !he 81115 timc * ,bou,d ■««> * possible 7o 
mob.!.*, iodmdiuj, and i.atrt«iofl. lo serve t£ £ 

common welfare. Usc nf 

Tlw Defecla of Capitalism aid CemaDnlio, 

Whoever fully appreciates fact will at once realise that 

and the system or secular democracy throw, up by lhc p rench 
Revolution were contrary , 0 !0C [ al jusIfce £ ' ™™ 

measure, may even oa a greater scale la th* - " 

h-t.» •j - . V * * JCl « CDc cornmoiiisin that i 

Miv du. fo, ,ch,,Y 10| coll . c , iv . weu-b.j,,,, jt ^ 
wci.IcOD.rol of, he conxnuoi,, 0 «, individual.. The foil, ' 

.t C o ra pi e . e ly »pp, (M «, ,h, frcedoo of individual,, f.^- !' 
1Mb,, Bd dm . 00 iD ot d,r l0 ..,«„ tte LniJivi d u ,'7^ 2 
of the ollcclive, [hi, ivstem vctt, ,ucl« gfc.l „„„..• 

oflnaoim..* of ,he nwchioc. Hew4o cU 
raonum citablishe, Kjcial jujiicc is a liar 
ONWuta. k u» Wotm F«- of Soci.1 Ty, ann, 

in i<*th commooiiB, it a* worn form of .ocial 


by force upon miUiou in the country. How can any rational 
person believe that they establish social justice when 
they expropriate the property and land of the people, nation- 
alise the industrial units aod turn the whole country into a 
prison camp in which all doors of criticism, petition, complaint 
writ or eqnity are tightly shut. How can there be social 
justice in a country in whicbtoere is no party, do organisation, 
no Torum where people may air their views, no press to mirror 
public opinion and no court of judicature to which the people 
may turn to obtain justice. Can the ends of social justice be 
meL in a country in whieb'tbe espionage network is so wide- 
spread that every persnn may suspect the other of being an 
Informer ; where before uttering a syllable even in the privacy 
of the home a man should look around for a lurking listener 
ready to carry the intelligence to the Government ? Again 
what fair-minded judge wilt call it social justice when elections 
are held to play a fraud on democracy aod the election mach- 
inery is so manipulated that no one who dissents from the 
authors of this social philosophy may stand io these election*, 
nor may any man of independent opinion or a conscientious 
person intrude into the electoral process. 

Supposing this doctrine brings about an equal distribution of 
economic wealth— although no form of communism anywhere has 
succeeded in cehicving this— what then, shall we say that justice 
is synonymous with economic equality? I am not posing the 
question whether there is economic equaiEty between the rulers 
of this system and their subject* I also do not a&k whether 
the dictator and the farmer enjoy &a equal standard of living in 
Ibis system. I only wish to know whether if complete econ- 
omic equality is really established among nil these people, will it 
be called social justice ? Would it be a just system in which the 
dictator and his henchmen are free to impose their self-conceived 
philosophy upon the people by the force of police, army and 
the intelligence system whereas the freedom of an individual 
member of the nation to speal but cne word of criticism on the 
philosophy, or the least action or part of an action of the 
ruling clique is prescribed ? Is it justice that whereas the dictator 


and h* few cohort, arc vwted with the right of using all mean* 
^conu&^io d,, couotry to di».iniLatc tbe Lr doctrine and 
to Jrt up ill kinds of organisations and oot even two persons 

SET *Jt tP*" fflay bC ftb ' e t0 wlMlH the ^«'ves into a 
body or to address . meeting or public n single line it, the 

J""* 11 " * M in * c ««* of justice to evict all landholders 
aod owners of..od»»tri« and to make the Government the sole 
proprietor of land and industry-a Government which Is run by 

nafor, aod eliminate .11 chances or the transfer power into 

H blioian l,f, U „ ae m „ e!y „ Kea0Bk eg.lit.riaoisa, b0 . 

T t """" ? " by Cl " npin * " d °PPr« S ioa m 

.11 rfiire ..a by suppr^a, other facet. * , lfe . an 

Uke placa and thi dictator himself .nd his .genu do come down 
to a n „„, „ u d.M of lira, wilh „, „ f £™ 

I....!*!" 1 , 1 f° * ta i.- tafore J"™ *o «»«f tenn. the of 
hZ.-Kf.TT ^ 3 P'""" 5 P h il«opby of justice in 

S u"= n« «^ ta " UP ° D Pe0Ple * f0rCe WilhnU « 

7 '° * »gaiost it. Abu Hakr sidd.que 

■nd u.iT F.rooq (God be p!ea «d with ,h eol , .p-t^A 

» if.? •* "P°" him). DKLiorrhip h. s no place m Isl*-, 

Muh.^ " al, "" a ' l0 « , y We* His OrdiaaL* ProX" 

Of Allah bct.ponh.0,) only because De p™*,^ 0rdc „ £ 



behalf of God rather than (Forgive God !) enunciating a philoso- 
phy formulated by his own soul. In the system of Government 
set up by the Holy Prophet (peace and blessings of Allah be 
upon him) and his right-guided Caliphs (may Allah be pleased 
with them) only the Divine Sbaria' wa» above criticism. Except- 
ing this limit, every person was free to speak oa all matters at 
any time. 

The Bounds of Individual Liberty 

In Islam Allah Himself has confined individual liberty within 
reasonable limits. He Himself hu debarred an individual Muslim 
from indulgence in certain forbidden acts and has enjoined certain 
duties whtch a Muslim must perform. He has clearly delineated 
she fights and obligations of an individual Muslim vis-a-vis the 
others. He. has identified the lawful means of acquiring ownership 
of property and goods and such other illicit means of acquiring 
property, as render its ownership unlawful. God has appointed 
duties upon the society which it must fulfil for the welfare of the 
individual. He has imposed restraints upon the liberty of 
Individuals, families, dans, indeed the whole nation, in the 
interest of she well-being of the society and has made certain 
obligations compulsory which individuals » well as institutions 
must discbarge in the service of society. All these rules are 
written in the permanent constitution given in the Book and the 
Sunna. No one his the authority to revise this constitution, and 
none has the right to make additions to or deletions from it* 
body. According to this constitution, a person definitely has no 
right to exceed the limits of the individual freedom laid down in 
the constitution. Conversely no ooe h authorised to curtail the 
scope of individual freedom envisioned in the constitution. Under 
this constitution, a person is obliged to shun such means of 
income and expenditure as have been declared illicit and in case 
he violates this rule he is liable to dire punishment, but the 
individuals rights of ownership over such wealth and property u 
has been acquired through .lawful means are guaranteed and no 
one can deprive the individual from the righteous means of 
enjoying his wealth. Similarly, a person is duty-bound to per- 
form such obligations as hsve bcea laid upon him for the 


collective weil-bein* k u1 _ n K, irH „, - 

« .iiuaic ngouo compel the lodividud to oerform w «m- 
horn lowut, ,h eln . K ,,,„ pe , naQen . h,s ""'l* 

« *HI etubliih inch > »rfc-> .» , i co ™ e ' f, " ,on " wfareed. 

even Itowtt i ng „ iou , lnd r ~^* " h " "WHutio.1 «!«,. 

borrowed r,o n „ iea a M * h " 

The Islamic CoDitituiion <*ft i.n , k.i 

»r , h . , f vid„, 10CTlgDl rx a rii r 

>o mucb freedom IO ,h e iodividu ., , *■ " co ««i« only 
power ,„ ,He ^^t..^^'^. «' -?* 

.0 .-tSffl^.SS^r "'° rf ' reB " ° f """" 

pilftn*. usurpatron wr <w L v Voc * ,,OBI i"»valvio g 


propagatioaofobscenicyarc f^h^. i, " reo,lcs 


keep such wealth, however, great or small it may be. No 
maximum or minimum ceiling may be placed on the possession 
of this lawful wealth. The possession of a small amount of 
wealth is no justification for robbing others lo arugment one's 
holdings, nor is the ownership of a large amount of lawful wealth 
a sufficient ground for forcibly dispossessing the owner ofhij. 
wealth. Nevertheless as regards the wealth which has been 
g'ained by transgressing the lawful bounds, the Muslims are well 
within iheir right io ask : 

(Where did you obtain this wealth) ? In the first place, a. 
judicial inquiry must be held about the sources of this wealth. 
Then if it is proved that this wealth his not been earned 
through lawful ronans, the Islamic Government is fully justified 
in confiscating it. 

Restrictions on thr Spending of Wealth 

The individual in not completely free lo expend even the 
lawfully earned weiltb, but has beeD placed under legal 
restraints in this reipect 10 that no ooe may spend bis wealth in 
a way which is detrimental to the society or which puisibe 
man's own faith and morality ia jeopardy. Itlam forbids any- 
one to spend his wealth on illicit and diisolute pastimes. 
Drinking and gamblijg are prohibited. So is adultery. Islam 
does not acknowledge the right of anyoa: to capture free per- 
sons and turning them into slaves. Similarly, Islam does not 
concede the right of anyone to buy or sell them so that wealthy 
should fill their harems with purchased female slaves. Islam 
seis limits to extravagance aod lavish *nd generosity. Islam 
does not approve of the circumstance that while you eat and 
driuk lavishly, your neighbour should go to bed hungry. Islam 
allows man to enjoy his wealth by lawful means and only 

•according to the rules prescribed by the Shar'iah. And if* 
man desires to utilise his surplus wealth tc cam more wealth, 

he can do so only by practising a lawful business. He cannot 

transgress the bounds which the Shar'iah has established for 

earning wealth. 

Social SatTice . . . 

For the sake of social welfare, Islam levies Zakat {wealth 



tax) on every person wbo possesses wealth above a prescribed 
limit. Besides, it imposts specific duties on the sale of goods, 
produce of the land, caitlc and certain other forms of wealth. 
Take any country uf the world and od computation yon will find 
that if Zakat 15 regularly collected there according to the 
methods of the Shar'iah and is then regularly disbursed on 
expense heads drescribed by the Qar'an, within a few years, it 
would be difficult to Bod in that country a aingle person in need 
of the necessaries of life. After the payment of Zakat, any 
wealth tbat ha* accumulated in the possession of man, must, 
according to Islamic liw, be distributed among bis heirs. So 
that this concentration cf wealth may cot assume ■ permanent 
and solid form. 
Liquidation of Exploitation 

Although Warn approves of the principle of open and free 

bargaining according to approved methods and settlement of 

disputes by mutual coo^ct between the landlord and the tenant 

and the industrialist sod the worker, yet wherever oppression 
and exploitation is being practised, the Islamic Government has 
the right to intervene and restore justice by taking legal 

Tie Limits of Nationalisation in tbe Poblic Interest 

Islam does not regard it as. unlawful tbat the government 
should run an industry or business under its own control. If tbe 
setting up of a u industry or business is needed in the public 
interest, but the individual entrepreneur is not ready to under- 
take tbe project or else its management by private individuals la 
likely to he detrimental to public interest, tbe government can 
lake over the management of this business and industry. 
Similarly, it the running of an industry or business under 
private management ti derogatory to public interest, the 
government can nationalise this industry or business and make 
suitable alternative arrangements for its functioning. There la 
nothing in Shar'iah which prohibits the adoption of such 
measures- But Islam does not accept the principle of total 
state control of the means of producing wealth which makes the 
State the sole proprietor of industry, business and land in the 




The Rales GoTerning tbe Expewe from (be State Trensnrr 

It It a definite rule of Islam thar tbe Bait-ul-Mal (State 
Treasury) is the property of Allab and tbe Muslim people aod 
no Jingle person has a proprietary right over it. Like alt other 
matters concerning The Muslins, the "management of tbe Beiu 
uLMal must be conducted ia Council with the whole nation or 
their free rep resent at ivei. Whatever is taken from a person 
and on whatever account the raoeey is expended, all transactions 
mint be settled In strict conformity with the rules of Shar'iah 
and tbe Muslim people have an inalienable right to question 
such transactions. 
An Iwialry 

While concluding this speech I put it to all thinking per- 
sons. If social justice means economic justice; is not tbe economic 
justice established by Islam adequate for us 7 Is there any 
reason after tbe establishment of tbe economic justice envisaged 
by Islam which necessitates tbe suppression of individual free- 
dom, confiscation of individual property and the reduction of 
the whole nation to the position of serfs to a bnndfut of 
masters 1 After all what prevents us Muslims to inaugurate 
Islamic Constitution and pure Islamic Law in our own States 
and to enforce the body of Divine Law Id its entirety. The day 
we accomplish ibis not only will »e stand in no need of any 
favour from communism, but tbe countries infatuated with 
communism bavin it observed our system of life will come to 
feel tbat the light for want of which they bad been groping in 
(be dark is io front of their eyes. 

The Difference between 
Capitalism and Islam 

TTw Economic ideology entitled by hi an, often the 
middk way between Communism and Capitalism. To build * 
practical system on ibe basis of its Ideology, Islam pressci into 
service both morality and law. By moral education Islam train, 
eacb individual follower to offer voluntary obedience to its 
system. Further, it impose* lucb legal restraints upon (be in- 
dividual as wiU compel him to remain within the bounds of the 
system. These moral principles and legal orders are (he founda- 
tions and pillars of economic system or Islam and a detailed 
study of them is an essential prerequisite to understanding (he 
spirit of this syitem. 

Distinction between Lawfal and Lelawful means of Earning Wealth 

The first point to note is that hlam does not give an open 

licence to its followers to gain wealth, but id order to safeguard 

the corporate interest iota up a distinction between lawful and 

unlawful. Thi, differentiation is based on the rule (bat all 

those means of gaining wealth are aniawful in which one 

man's profil means aooCher man's or men's loss. On (he other 

hand all those means of earning wealth are lawful which involve 

a fair exchange of pro8t between the concerned parties. 

Tbe Holy Quran enunciates this principle in the following 
words ; 

" O ye who believe ' Squander not your wealth among your, 
selves in vanity, except it be a trade by mutual consent, 
and kill not one another. Lo ! Allah is ever Merciful unto 
you. Whoso doth that through aggrestion and injustice We 
shall cast him into Fire." (An-Nisa 29.30) 

Trade in ibis ayat denotes exchange of goods and services tor 
money. By imposing the condition of mutual consent all 
those forms of exchaage have been declared illicit which involve 




coercion of any sort, or deception or intrigue which, if it wefc 

.known would have deterred the other party from consenting to 

the exchange. To lay further emphasis on the point it has been 

said ljU- V. This bears double meaning, both of which are 

implied here. 

One, you should not kill one another. Second, do not kill 
yourself. The implication is lhat a person who earns profit at 
the expense of another U a b:ocid su:ker, and in the long term 
paves ihe way for his own destruction. 

Apart from (bis basic injunction, the following forms of 
earning wcaJih have been declared unlawful at various points in 
the Holy Quran ; 

Bribery and misappropriation. (Al-Baqarab : 188) 

Embezzlement of Public or Private Wealth. 
. ■ (AIBaqarah : 283 : Al-i-Imran : 161) 

Larceny. - (Al-Maidn : 3fi) 

Unfair use of the Property of an Orphan, (An-Nisa : 10) 
Short Weights and Measures. (At-Tatftef : 3) 

Trade lines which promote obscenity. (An-Nur ; 19) 

Income from Prostitution and Adultery. (An Nur : 2-33) 
Manufacture, Sale and Transportation of Liquor. 
" (Al MSida : 90) 

Gambling and all those means in which the passing of wealth 
from one party to aoother depends on mere chance or luck, 

(Al-MSida ; 90) 
Making and Sale of Idols and Services in or to temples. 

(Al-MSida : 90) 

Fortune Telling and Drawing Lots (Al-MSida : 90) 

Usur y (M-Uaqarah : 275 : 280 ; 

Ban on the Hoarding of w « ailfl Al-Mmran : 130) 

The second imporant order is not to hoard one's earnings, 
for this steps the circulation of wealth and creates imbalance in 
its distribution. The hoarder of wealth does not only suffer 
from grave moral ills but in factcoromits a heinous crime against 
society the dreadful consequence of which ultimately visits on 
him. That is why the Holy Quran denounces stinginess and 
boarding in the severest terms. It says. 


" And let not those who hoard up that which Allab hath 
bestowted upon them of Hb bounty thiol that it is better 
for them. Nay, it is worse fot them." (Al-i-lmran : 180) 
'* They who hoard up gold and silver and spend it not in the 
way of Allah, unto them give tidings of a painful doom." 

(At-Taub»; 34) 

This is a direct blow at the foundation of capitalism. The 
practice of boarding wealth aud its investment in productive 
ventures lies at the root of capitalism. But Islam disapproves of 
the hoarding of surplui wealth. 
Injunction to Rpeod 

Islam enjoins spending, not hoarding uf money. Rut this 
does not mean spending on luxury or squandering. r*rarq decrees 
spending with the proviso that money should he spent in the way 
of AlUh-i.e. the individual should spend his surplus wealth on 
Social Welfare projects. 

M And they ask thee what tbey ought to spend say : That 
which ia superfluous." (Biiqarah ; 219) 

" Show kind new unto parents, and untn .near kindred, and 
. orphans, and the needy, and unto the neighbour who is of 
kin (unto you) and the neighbour who ia not of kin and the 
rellow traveller and the way fater and (the slavfi) whom 
your right band possesses. (An-Nlsa: 35) 

" And in their wealth the beggar and the dtprived had on 
equal share." (Al-Zartat : 19) 

At this point the Islamic doctrine presents a complete anti- 
thesis to the capitalist ideolngy. The capitalist believes that 
spending will impoverish, him ; Islam says spending entails bles- 
sing it. the wealth will increase rather than decrease by 
spend in*- : 

"The devil promiseth you destitution and enjnincth on you 
.lewdQesss. Uut Allah promiscth you forgiveness from 

Himself with bounty." (Al-Bacjarah : 268) 

The capitalist considers spending a loss ; Is.irn sayi spend- 
ing is not loss but an investment which win ultimately return to 
yuu with added advantage. 

"And whatsoever good thing ye spend, it will be repaid to 



yoa in full, and yc will oot be wronged.- lAI-Baqarah : 272) 
"And those who spend out of Our provisions openly and 
secretly anticipate a bargain which involves oo loss at all. 
Allah will reward them a full return— nay wit! give. them 
even more out of His bounty." (Fatir : 29-30) 

The capitalist believes that hoarded wealth, when lent out 
on interest, brings in more wealth. Islam says that interest 
actually decreases wealth. The only means by which wealth 
may be increased is to invest it in pious worki : 

"Allah hath blighted usury and made almsgiving fruitful." 


"That which ye give in usury in order that it may increase 
oo (otbej) peoples' property do increase *itb Allah, but 
that which ye give id charity seeking Allah's countenance 
hath incraejed manifold/* (Al-Room : 39) 

Tnls is a new doctrine which presents a complete antitbesii 
to capitalist theory. 

Wealth increase* by spending, the expended wealth docs 
not go waste but rebounds to the owner with added advantage. 
Interest does not increase but decreases wealtb, payment of 

Zakat and Charity adds to rather than diminishes wealth 

these doctrines do appear odd. One gets the impression that 
all these doJtrioes.promise reward in tbe seat world only. There 
is no doubt that the implication of reward in eternity docs exist 
and Islam gives it tbe primary importance, but a deeper study 
of these doctrines would reveal thai ibey have a sound economic 

The ultimate coosequeDce of hoarding wealth and leading 
it out on interest is that wealth concentrates in the hands of a 
few individuals, purchasing power of the masses declines each 
day, industry, trade and agriculture enter into a phase of 
depression, national economy reaches i be breaking point and 
ftnally all avenues of productive tD>eu:oeat of bearded wealth 
are cksed on the capitalists ihemaelvea.* 

1. Tbe statement of ih« Holy rrapfeat(Pbuh) ;~ 

"However high tbe interest It uhisitely results it loss." 
Obr.-l- MiJa-Baibaqi-AbiDiC- alludes la thii very paint.) 


In contract (he advantage of spending money and pay meat 
of Zakat and charity 1$ that wealth teaches all individual* in 
society And as each individual acquires sufficient purchasing 
power, industry flourishes, fields prosper, trade thrives and even 
if there be no millionaires or multimillionaires, everyone becomes 
affluent. The greatest proof ol* tbe validity of this doctrine is 
presented by current economic conditions in America 1 

Usury has created a chaos io the distribution of wealth, 
and depression tn Industry aod commerce has driven national 
economy to the brink of dirtier. 

In contrast to this look at the State of Economy in the early 
phase of Istam, when after the full enforcement of Islamic 
Economic System the level of general prosperity rose to such a 
height tbat donora looked about for anyone deserving of Zakal 
and found none. A comparison between these two iyitems 
of economy will reveal how Allah blights usury and grants an 
increase to charity. Aialn the outlook developed by Mum in 
quite different from the capitalist outlook. The capitalist simply 
cannot imagine at all that a raaa can advance hii money with- 
out interest to anyone. He not ooty charges interest oti the 
loan, but to reccvtrhii capital and interest take out a court 
decree for the confiscation of (be debtors' personal and house- 
hold effects. 

On the other band Islam teaches that a loan should he 
given to the needy person, and not only that but also the debtor • 
should not be subjected to pressure for the recovery of loan if 
he is indigent so much so that ifnecinnoi pay ai all, the 
creditor should write off the loan. 

"And if the debtor is in straitened circiiniitsnccs , then 
(let there be) postpone meet to (the time of) ease ; and that 
ye remit the debit as almsgiving would be better for you if 
ye did but know." (Al-Baqarab :'2B0>. 

Co-operatives in Capitalist System are formed by sub- 
scribing members who alooe can secure loans from their 

I. This refers to the dreadful '6tptemoa prcvuliniin U S.A. at lb* 
Mm* of writ in* 


co-operative at slightly less than market rate of interest. Thus 
a non-subscrlber, is not eligible to raise a Joan from the co- 
operative society. By contrast in the co-operaiive system 
envisaged by Islam the affluent sections wjlt nut only lend money 
to the poorer sections whenever required, but also assist them 
in repaying the Joans Tor the sake of Altai'. Among other*, one 
bead of expenditure of Zskat is Cr-jWj i.e. relieving the 
debtors of their burden of debt. The capitalist spend* on good 
works for gaining a reputation only. He oju.i at least tarn 
social respect for incurring such expense. Islam, however, 
forbids exhibitionism. A Muslim should never expect so im- 
mediate return in any form whatever be spends in public or in 
private. He should fix his gaze on tbe long term consequence. 

From here to eternity, to whatever extent your gUoce 
reaches, you will see Ibis investment flourishing and producing 
compound profit. 

"The example of a man wbo spends to make a name is like 
soil on a rocky bed. The seed is sown in this soil, but a 
torrent of water washes away the soil. The example 0/ a 
man who with a pura niture ipjods for the sake of Allah 
only is like fertile soil io which a girdeo is pljutcd. if it 
rains, the output of fruit is doubled, otheriviic even a light 
shower h enough for it to bear fruit." 

(AJ-Baqarah : 264-265) 
"If ye publish your alms-givm-, it is wen, but if ve hide it 
and give ii to the poor, it will be better for you "' 

(A'-toqarah r 271 J 

Tbe capitalist spend> on goad work* wit*i ai unwilling 
heart. He gives away only the least valuible tzidi and by bis 
tongue -lashes never lets the donee forget ibul h: nis done him 
a great favour, contrary to all ibis Islam sojoias on the 
believers to give away the best* not to put the don.-c under ao 
obligation, no, not eveo expect any expression of grattiudefiom 

"Render not vain your alms-giving by reproicb and injury, 
like aim who speodetb his wealth only to be seen of men." 

(AJ-Baqarah : 264) 


Leave Slide (be question of how great the difference is 
between (faes? two outlooks on s moral plane. Take only 
ibe economic aspect and see (hat from the point of view of 
low or advantage which of these doctrines is more stable 
and sounder in ifa c long term. 

In view of the aforementioned doctrine of Islam in respect 
of loss and advantage, bow is it possible for Islam to endorse any 
form of usurious business. 

As mentioned above, the objective constantly kept in view 
by Islam is to prevent the concentration of wealth in the hands 
of anyone, anywhere. 

Islam asks those who by virtue of ability or chance, have 
gained superfluous wealth, not to hoard it, but to expend it in 
such a way that the depressed sections of society may also get an 
adequate share from the circulation of wealth. For this purpose 
Islam by its lofty moral doctrines and effective motivation and 
training engenders a spirit of generosity and genuine cooper- 
ation to that the people should acquire a natural distaste for 
hoarding wealth and incline towards spending it. Simultaneously 
Islam provides lhat such people as disregard the precept of 
generosity and cannot give up the habit of hoarding wealth, or 
those with whom wealth accumulates for cue reason or the other 
should be obliged by law to pay a portion of their wealth for 
social welfare. This is called Zakat, which holds such an import- 
ant position in the economic system of islam that it has been 
included among the articles of faith in Islam. 

The obligation to pay Zakat rank* next only to Namai and 
it has been made clear that the wealth of a hoarder will become 
lawful for him only when he has paid the Zakat on it. 

■* Take alms of their wealth, wherewith thou mayst purify 
them and mayst make them grow." (At-Tauba : 103) 

The last words of the ayat clearly show that the wealth ac- 
cumulated by a man is impure in the sight of Islam and cannot 

become pure until he spends is the Way of Allah a statutory 

portion of it every year. What ia tbe connotation of '* Way of 

AUab." Allah is independent. The wealth you spend neither 

reaches Him nor does He need it. The "Way of Allah" denote* 



spending tbe money for the financial veil-being of poor sections 
of wciety and for promoting social welfare projects designed to 
benefit oation.i 

"The alms are ooly for the poor and the needy, and tbo« 
who collect them and those whose hearts ire to be reconciled, 
and to free the captives and tbe debtors, and for the cause of 
AlJafa, and (for) tbe way-faier ; a duty imposed by Allah; 
Allah is Kno*er, Wise/' (.At-Tauba : 60) 

This 15 the Cooperative Society of Muslims, their Insurance 
eompany, provident fund, fund for the assistance of tbe unemp- 
loyed, agency for the maintenance of the disabled, maimed, 
sick, orphans, widows and the unemployed. It h a guarantee 
that no member or the Muslim society shall Jack the necessities 
of l.fe. Above all. it frees a Muslim from the cares of tbe future 
The basic principle of Zakat is simple and straightforward ; You 
are affluent to-day. so help others. If you become poor t'oaor* 
row, others Will help you. 

You need not worry about a«y future decline in your fiaacl- 

aJ fortune or the fate or ynur family in casc of yo ur death, or 
economic security against such unforeseen calamities as sickness 
fire in tbe bouse, flood, bankruptcy etc. and destitution during 
Havel. Zakat frees a Muslim from all these worries The 

1. The phrasa". Jarfra{gh«i««cleifly deaott, . specific rate of c 0 .,j„. 

.CTt A In.. J' ol ! l " J,0£ * " d =«1*wry charity ever an d 

51? ? £" ilv - on tn< affluent poopl.. ]a 

obedience to this Divine commiod. the Holy Prophet (peace be oobim) has 

prMcnbcdi specific Nnjit r 0[ etch form of we.libbelotv which tbe ohlifia- 

and commerc,il joodj n 2\% per tanum. On The -iluc of Aaticulwral pro- 
doci or hnds in nitural rafofall irtu tee rate is 10"^ aad on th* v t | Uc of 
kadi im B at«d by initial nx*i» ia f fl , E n s% p<1 aoouin 

r-?"^^ fUQdcr PriVlte a *«r,fc; P > "J trruurttrove the rati is 20%. 


Murfiios duly is to subscribe a pan of his income and become 
ao account holder in God's Insurance company. Tba subscriber'* 
payment will benefit the needy today. It tomorrow the sub- 
scriber himself or bis descend 33ti become needy, not only (he 
sum total of his own payments but even more will be returned 
to him. 

Here again we notice a complete contrast between the prin- 
ciples and tenets of Islam and Capitalism. Pooling money and 
increasing the pool by lending out money on interest is the sin* 

qua nan of capitalism, so that public money constantly keeps 
draining into the pool from various channels. 

On (be other hand Islam enjoins that money should not be 
hoarded, but if it does accumulate streams of Zakat should be 
set Bowing from this reservoir, to that parched field* receive 
water and the entire tract nourishes. 

The exchange of wealth under Capitalism t» restricted, in 
Islam it is free. 

From the reservoir of Capitaiisa you cannot draw a drop 
of water unlets you have already contributed a share of water 
to the reservoir On the other band tbe rule in the case of 
Islamic reservoir is that whoever has superfluous water should 
pour it into tbe reservoir, and whoever has need should draw 
from rt 

Clearly both systems, in their basis and nature are antithe- 
tic. To couple them would be to couple entirely different specie* 
which is beyond contemplation of a rational mind. 
Law of Iiaerltaaea 

Next to personal expenditure charity in the way of Allah 
and payment of Zakat, there is one other device by which Islam 
brings tbe accumulated wealth back into circulation. This device 
is the Law of Inheritance. 

The object of this law is to parcel out the estate (whatever 
its size) of the deceased among his near and distant kins in ac- 
cordance with a prescribed Code. 

And in case a person has no beir or a heir cannot be traced 
after bis death no claim of adoption shall be entertained and tho 
estate sbali be assigned to tbe Bait-al-mal (Public exchequer) so 


that the entire nation may benefit from it. ' 

The Islamic Law of Inheritance i& uoique and the like of it 
cannot be found in any other economic system. The object in 
other economic systems is that the accumulated wealth of the 
deceased should remain concentrated in one or few hands Islam, 
however, abhors concentration of wealth in any form and aims at 
the maximum distribution of wealth in order to facilitate it* 

Distribution of ihe Spoils of War and Conquered Property 

In thi, c «e also Islam holds f a5t lo t he above objective 
The law regarding the spoils of war is : 

Divide them in five .hares; four of which should be dis- 
tributed among the. troops, while the remaining one should be 
allocated to State purpoie*. 

And know that whatever ye t-kc as spoils of wjr, | u i O0 e 
fifth thereof is for Allah, and for the Meuenger and for kias- 
man (who bath need) and orphan, and the needy ami the 
****** " (AJ.ADfaJ:41) 

. V r Ti? AIUb Md ^ " rtfe " t0 the 

for the fulfilment of social purpose. aod interests uodet the sup- 

ervision of the Islamic State established by Allah and His Apostle 
(peace be on him). 

2. A share was assigned to the relatives or the Apostle 
(peace be on him) because taey were not entitled to receive 
Zakai. The Prophet fpeicc be on him) used fo pay the dues of 
his relatives from this source. Later [bin «hare wai transferred 

* mm m 

classes in particulat have been 
assigned shares in the ^ . First, orphans who must be educated 
and trained for purposeful occupations. 

Sccund, dektitutea including widows, disabled, maimed, sick 
and poor members of the society. 

Thirdly, lb«N-Sabt*t-i.t. traveller*. The moral code of 

Islam sn ulcates the virtue of hospitality. Along with this a share 

id the Zokat, chanty and spoils of war has also been assigned 

to travel!.^. Th« measure greatly facilitated journeys for pur- 

toHsJtf il^mt* ° f Pfim °* eoiture Ind the J oiot Family System are 



poses of trade, tourism, education, and study and observation of 
affairs and archaelogical sites across Muslim countries. TbeUw 
regarding lauds and goods acquired as spoils of war was to keep 
lL ™i entirely under State control. 

"That which Allah giveta as spoil unto His Messenger from 
tbe people of the townships, it is for Allah aod Hit Mes- 
senger and for the near of kin and the orphans and the 
needy and tbe way-farer, that it becomes not a commodity 

between the rich among you And (it is) for Ihe 

poor fugitives war have been driven aut from rbeir homes 

and their belongings Those who.entered the city 

and the faith before them And those who came 

into the faith after them." (AJ-Haihr : 7-10) 

This ayat not ooh lifts the heads under which the <> 1 shall 
be expended, but also clearly points to the objective of Mam 
not only in the matter of the distribution of ^ but in the entire 
economic system, i.e. the circulation of wealth should not 
remain conBned to your affluent class. 

The idea contained in this short but comrreheosive state- 
ment of the' Holy Quran is the cornerstone of jhe economic 
system of Islam. 

The Injunction to L cob a mite 

On the one hand fslaru has taken measures to keep the 
wealth in circulation and has assigned to the poor a share In 
tb= wealth of tbe affluent class, as you have seen abovr. 

Ott the other hand, it enjoins every person io study economy 
and adopt thrifty habits, so that peoplt should not expend their 
resources extravagantly and thus up ie t ifae economic balance of 
ib^ society. On rhis subject the Holy Qurau iSMj=d ihe following 
comprehensive instruction. 

• And let not thy band be chained to thy neck nor open it 
with a complete opening, lesi thou sic down rebuked, 
dcnud ^-" tBaai hrael ; 29). 

"And those who, when ifcty spend, are neither prodigal, 
nor grudging, and ibere is even a firm station between the 

4. .1* * V . 

, ^ is propeny acquired without 6jh"i>*- 



two (Al-Furqao : 67) 

The purport or ibis instruction is that a man should live 
within his meant. He should not bt to extravagant that his 
expenditure out paces hit income tad be h reduced to begging, 
expropriating other peoples' income, contracting debt, without 
sesame need sad then labour under the burden of debt or 
exhioit hit economic resources in paying off debts and join the 
ranks of the destitute. Nor should a man become so stingy chat 
he should not Jive according to bis meant. Again landing 
within one's means does not imply that an affluent man should 
ate all his income in buying private comfort and, luxury and 
living in an ostentatious style, while hit own kith and kin, 
friends and neighbours are eking out a miserable existence. 
Islam deems suob aelbih expenditure as extravagant, 

"Give the kinsman his due, and the needy, and the way- 
farer, and squander not (thy wealth) in wantonness. Lo 1 
the squanderers were ever brothers of (he devils, and the 
davil wax ever an ingratc to bis Lord." (Bani Israel :.26 ( 27) 
In this connection Islam does not confine itself to issuing 
moral precepts onJy, but has framed laws to curb* the abnormal 
sjfnginesa or extravagance and has tried to eliminate all factors 

wWch tend to throw the system of the distribution of wealth into 

It declares gambling unlawful, forbids drinking and adultery, 
bans all forms of extravagant and sinful habits which inevitably 
result in waste of time and wealth. It restrains the natural taste 
for music and does oof allow it to develop it to the extent where 
it gives rise to moral and spiritual Ills and often causes disruption 
iq economic life. 

It seta limits to the development of the natural aesthetic 

The main purpose among others of the Holy Prophets (peace 
be on him) Injunctions about costly garments, gold and diamond 
ornaments, gold and silver vessels and pictures and statues, is 
that the wealth which can buy the necessities of life for your 
poor brethren, and can provide them with the means of subsist- 
ence, should not be spent on bedecking your person or decorating 



yourhoma. Such fatbits do net reveal an aesthetic sens* but a 
callous sod leifeb spirit. 

In abort, both by moral precepta and legal order* Islam hai 
eDjoiocd a style of lira wbow ibnplfcrty win not allow a man to 
eitend bis needs ud deiite* beyond the scope of normal income. 

' Thus do Muslin should exhaust bis own income and beg from 
others, and AO Muslim commanding an above average Income 
should spend all nit wealth oo his personal needs and refrain 
from assisting brother Muslims whose income is below average. 


Economic System of Islam 

(Some Aspects) 

Ownership of Land 

Tfce question of Ac ownership of tin* is one of the u ^ t 
prominent i«ues in mc^ent ((me.. It h.s Inea .ubiecled to 
■ueh prolonged debit, ib.t trurhba, bcoo buried under (Click 
levers of polemics .ad .No correct «n B L of vision b.. been 
badly imp«ired, 

On |bn one side ire people who uphold the CipiuUsic system 
or iQdivjdioJ properly end «i the Otnei extreme It (He fiction 
»bico champion, the'cojomunlitlc system of collettfvHm, 
The snppoTtef. of individual ownership pf property .re 
dubbed o. the token of,, while tbe opponent, 
« contemporary feudalism ire unable to conceive of toy 
alternative scheme of re form I o B ltd, ly.tcn, except the 
complete national Jintion of Had. It I, due to this aberration 
lo outlook that people Audit h.rd (o undented the i.l.tnJo 
coocapt or owoirship. The Icirood author hi. written 
extensively oa the subject, we ere only reproducing here a Tew 
extracts from his writlogs in i relrranged from io order chit 
(be reader mey clearly imp tbe staod-poiDt of Islam. The 
Islamic concept or ownership, must be studied in tbe perspec- 
tive of Ihe Economic Sy.teo, of IsUm and not with reference 
to UD-Islamic ideologies. Yet another basic feet which must 
be borne Jn mind j, thit the institution or individual property 
Is much older tbm ihe C.pitiliitlc sy.tem, Capitalism hi. 
» doubt exploited chr. io.t.tutioo ..d b« ,iv.o it i p.rtlcul.r 
form, maJmc however, has sprung not from iadividuil o*oer- 
ship but from the spirit, the fuotUmeBi.l .,mi. concept, end 
institutions of Cipiulum. V/hjce reflecting on this problem 
the controvert started by miipl.ced communis writers over 
ind.v.dual ownership 4n d it, distorted form under Capital^ 
must be shunned. 






In the first piacc I must remind you or one fundamental 
ruJo which is that when a common custom is passed over without 
comment, It shall be taken as the approval and justification of 
that custom. For instance, if the public have carved out a path- 
way through a plot of land and there is no notice prohibiting 
the trespass It shall be taken to mean that it is legal to use the 
pathway. No license is required for passing over the track for 
the absence or any prohibitory notice itself legalizes the act. 
Same is the case with the ownership of land. The institution 
of ownership ofland had existed in ihe world for thousands or 
. year* before Islam. The Holy Quran did not proscribe it. It 
issued no definite injunction to scrap the institution. It gave no 
law to replace it No where did it denounce the institution even 
implicitly. This only meant that AUab held this old inatstution 
as valid and it Is with this undemanding that since the reveia- 
lion of the Quran to this day the Muslims have kept alive the 
institution of the private ownership of land in the same way u 
it bad existed before the advent or Islam. If anyone today is 
convinced of the non-justification of the Individual ownership of 
land, he should bring forth evidence for it Instead of demanding 
proof Of justification from us. 

Bui it is not merely (hat the Quran has not abolished this 
ancient institution. If you study the Quran attentively you will 
find that it has validated the iastituiion implicitly and made 
this institution the basis of many of its social and economic 

Consider now, man has only two purposes with the land : 
cultivation or habitation. The Hoty Quran acknowledges in- 
dividual ownership for both these purposes. Sura Inam says : 

Eat ye of the fruit thereof when it fruiteth, and pay the 
due (of Allah) thereof upon the harvest day/' 

(Ai-An'am : Ul) 

Here the term " due of Allah " denotes Zakai and Charity, 
if the land is collectively owned no question arises for giving or 

l. Adapted from the book "The Question of ihe OwMrtkt&9f tt>*4" 


taking of ZakaK This Injection could only be issued oa the 
premise that a section ihculd own (he land and donate the da E 
of Allah from its produce and another section who do not own 
(he land should receive (his donation. Say now, hn not Allah 
affirmed the ancient institution of the private ownership of [and 
by tbia injunction ? 

Thb is corroborated by another Ayai : 
"O ye who believe ! spend of the good things which ye have 
earned, and of that which We bring forth from the earth for 
>° k u " . (ALBaqarah : 26?) 

There .a consensus of opinion (bat tne injuuetinn of apend- 
ing out of the produce of (and ' in th» Ayat refers to 7.ckai and 
alms-giving, well, this injunction wiil only be carried out by one 
who owns the produce, and <he beneficiaries will be those who 
own no wealth or property. Hence the Holy Quran mentions also 
iho categories of people who deserve alas : 

f^f % for lbe poor wh0 •w«f*'teiied for the c»u*e «f 
Allah, who cannot travel in the land (for trade) ". 

4 . _ , " (Al-Baqarah : 273) 

The alma are only for the poor and the needy." 

(Al-Tauba ; 260) 
Regarding the second purpose. Surah Nur Mates - 

" O yc who believe ! Eater not houses other than your t-vo 
without first announcing your presenco and invoking o* ce 
upon the folk thereof. Tbat is belter Tor you, that ,e m, v 
be needful. And if ye nod no one therein. Still enter no* until 
permfSMOa b*!h been given." (Aa*Nur - 27i 

This reveals that the Holy Quran afflra, the principle of the 
private occupation and ownership of land for resideatiaJ n U r. 
poses also and admits tbe right of an owner to permit or forbid 
the entry of any person Into the bounds of his property. . 

Let us turn to Hadith now. if wc take an overall view of 
all the .statements of the Holy. Prophet (peace aad brings of 
Alia* be on bun) on this subject, the practice during bia p^od 
and the precedents set up in the rcim of rh* rloh* !Z aa 
Caliphs CAW b, : pleased w'ith chem),^ 1 tcEFSS 
Uw regarding the ownership of J and was derived by the scboi- 


an approximate to the time of the Holy Prophet (peace be on 
bim) from tbeir comprehensive study of tlx; Quran, Hadith and 
the precedents of the illustrious companions (Allah be pleased 
with them), there remoios not a shadow of doubt that Islam not 
only hold* private ownership of] and as valid, but also set* no 
ceiling on the extent of land ownership, 1 and confers upon the 
owner the right to lease or rem out the land which he himself 
does not or cannot cultivate. 



In order to understand the Land Syitam in the period of the 
Holy Prophet (peace be on him) and the righc-giikled caliphs 
(Allah be plea&ed with them) it must be borne in mind that lands 
pawing under the jurisdiction of an Islamic State are divided Into 
four major categories according to the Sbariat. 

(1) Lands whose proprietors embrace Islam. 

(2) Lands whose proprietors adhere to their own faith 

are not converted to Mam), but under an agreement, 
become subjects of the Muslim State. 

(3) Lands whose proprietor* are subjugated by force of 


J. Jc thould be clear, however. Chic thli rule appifo under normal con- 
ditions. In extraordinary circutnuara* rhe State eta Id (he interest of 
justice aod the nihil of God *nd His people iinpoie certain rotation* ai 
fiieftlioned id the hocks of fiqh SicoilJrly if aced be.a particular Industry or 
Agricultural tract may be nationalized &n tbe f rounds of Shanah. But the 
overall system ol Economy id ihr State must be constructed on tbe basil of 
private o*oersbip> So fat ui I hjvc vtydicd this qaesliuo id the light of 
Islam, I tan say in all honesty chat Wain does not adopt the programme of 
n^t-OQ^Iizafion of the mfians of produ^tiOD as a tvle. Such a programme 
I* derogatory to Tbe scCiaf milieu or blain. 

From the poinl of view cfltlam* total nationahzjlloD of the UHinS of 
production does boi offer the correct solution of the Economic problems of 
aStaia. Nevertheless if experience proves that the private ownership o f 
■ particular Industrial or Commercial enterprise ii not coaduci?e to iti 
growth it can be taken tinder Sutt Control. 

OWNITUttJj* Of UNb Ijj 

(4) Lands to which no one holds a title. 

We shall now describe the policy adopted by the Holy 
Prophet (peace be upon him) and his caliphs (Allah be pleased 
with them) with regard to each category of laod separately. 
First Category 

The principle adopted by the Holy Prophet (peace and bles- 
sings or Allah be on blm) la the case of the first category of 
lauds was this : people accept Mam. they preserve their Jives and 
prup*rtiei." [Abu Dawud ; Kitub ul Kharaj Ft Iqta it- 

"The properties which a person owned at the time of accept- 
ing Islam shall remain under bis ownership {KUab-ut* 
Amwal by Abu Ubaidj. 

This rule applied to movable as well mm to immovable pro- 
perty, and the policy adopted witft regard to agrarian property 
was the same because the poiicy adopted wilh regard to bo lb 
■Italian and non-agrariaa lands was unif/urn. 

The entire corpus of Had it h and precedenis proves that the 
Holy Prophet (peace be on him) did not even slightly intetfere 
with the proprietary rights of anyone is Arabia who had embraced 
Islam. Whoever owned anything was confirmed in his title. The 
Islamic Law on this subject is explained by Imam Abu Yusuf 
(may Allab show him mercy) in these words :— 
, "The people who accept hJam. the spilling of their blood is 
forbidden. The properties ihey owned at the time of con- 
version to Islam Shall remain under their ownership. Similar- 
ly they shall hold title to their land* and those lands shall be 
declared Ushri (i.e. ihey *hall be subjected to ■ Ushr).. The 
precedent for this is Medina, whose citizens accepted Islam 
at the hands of the Messenger of Allah (peace be on him), 
find they retained ownership of their lands, upon which Ushr 
was levied. The people of Taif and Bahrain were treated in 
the same way. 

Similarly those among the Beduins who embraced Islam we*c 
confirmed in their title to springs and tracts owned by them* 
Their (and is Ushri (i.e. subject to Ushr) and they cannot - 


be evicted from it, and tfcey bold aU tights of sale, trade and 

Inheritance over it. lo exactly the same manner, when the 

residents of &a area accept Islam , they shall remain owner* 

of their propertiea." {KUob-ul-Khara}. p. 3$) 

Another venerable scholar of the Economic Law of Islam, 
Imam Abu Ubaid al-Qasim bin Salam writes : 

"The evidence that hi* come down to ui from the time of 

the Holy Prophet (peace be on him) and hi* caliphs (Allah 

be pleased with them) contains three categories of Order* in 

regard to land. One category relates to those lands whose 

owner* embrace Islam. Whatever land they owned at the 

time of (heir conversion shall belong to them, but that land 

will be declared Uahri and no other ceta eicept Ushr shall 

be levied on them. (Kitab-ut-Amwat, p. 55) 

Further on he write* : 

'•In those areas where people embraced Islam, they retained 

ownership of their lands iuch as in Medina. Taif, Yemen 

and Bahrain. Similarly though Mecca wai taken by sword, 

the Holy prophet (peace be on bins) showed favour to it* 

citiaen*. proclaimed a general amncrjy and did not declare 

their properties the spoils of wax so when their pro- 

pertiej were left in their charge, and when *ub*equeDtly they 

becamo Muslim*, their properties were subjected to the same 

rule* as those of other convert* to Islam and their land* were 
declared Uihri." tP, gB 5I2 , 

Ailam* Iho ul-Qayyim (may Allah show him mercy) writes 

"The Holy Prophet (peace be on him) a* a rule allowed a 
convert to retain whatever ■ property he owned, irrespective 
of the means by which he had acquired that property prior 
to his conversion. The convert's property was left in his 
charge a* it waa," (Vol. 2, p. 96) 

We do cot find a single instance of any exception from (hi* 
rule in the time Of the Holy Prophet (peace be on him) and the 
right-guided caliphs {Allah he pleased with them). The economic 
- reform* of Islam were not introduced with retrospective effect. 
The title of the new converts to their previously held properties 

fCDMined in'act. 


t- "^"^ ^f*™ <o become the tubjecu or the Jslamir 

the term, of peaL- c , for «cc« is lawful r or y(in /> 
Ac^rding ,o .h. ™ k wlKfl lbe Holy PropfcU-aTh,' 

«• uc aaa possessed id Najraa. And not onJy this 


Hadrat Umar (Allah be pleased w, fh him) issued a general decree 

-With whichever n al i on umon£ the non-.V^Ii™, , he I a3m 
that they bec^e subjee, and p.y lri b ut c, tbu n.tioo 
They sball be sub,ect oa l y t9 51ich | £v} , „ waJ 

sar —-—is: as*- 

Tfclrtf CftCcgary P ' 

A. for rbe people who fight to the last and are lubdued by 

the Holy Prophet (peace be on him) and tbc rigbt-guided <£liohi 
(Aliab be pleaded with them). IW P * 

One the policy adopted by the Holy Prophet < be oa 
hint) oa the eye of the victory of Mecca: Proclamation of general 
wweuy f^U ^ ^ and grant of coo^settirie^lto 
and property to ihe conquered people. In .his case, a* hi beea 
stated above, the citizen, of Mecca rented io potion of 
their lands and properties, subsequent to their conversibo to 
Islam tbeir lands were declared Usbri Object to Ushr tithe) 
nn ^P^* followed by tbeHuly Prophet (peace b. 

on h.rn) in Khybcr re. declaration of the conquered landj aa 
spoils or war. m thi* case ike title of previous ora„ »„ 
abolished. A pan was allocated to (be bead -For God «,d k" 
Apostle' and the rest of the lands were distributed among the 
troops who fought in tbt campaign of Khyber, The soldiers 
were g>veo proprietary rights over their shares of land, which 

OWNtRSlto OF LAND ,j g 

»ngi M | owners l0 i.. y on their land, w a. , °"f d <hc 
Dhimim, levied J.zia (Poll Tal ,„7 ?1 ^'"'og Ihem la 

of , h , Ja , a JSbi"^: o^,^ J h ; 

.urned down u, , wslioil . ^ in ,£ ^ " * "™) 
the heir of aoolbt r mill be a child The SUJ™. , 


suited to interests of ;be present as well as the next genera- 

Hadrat Alt (Allah be pleased with him) said : 

" Leave tbe farming population of the country .[one, io that 

tbey may become the means of economic strength for the 

Hadrat Umar declared : 

" How can it be tdat I should distribute this land among 

you and leave no share in it for the next generation.. ..After 

all what share will posterity have in rt ? Do you mean 

to leave nothing for the future generation?. And be- 
sides, I fear that if I distribute it (the land) among you, 
quarrels will rise between you over water (irrigation)." 
The decision arrived at on this baiis was that the existing 
owners should he allowed (o keep (heir lands- They should 
however be declarod Dhimmii and subjected to Jazia (Poll-tax) 
and tribute, and the revenues from this source should be spent 
on the general welfare of the Muslims. The teat of the letter in 
which Hadrat Umar (Allah be pleased with him) notified this 
decision to Hadrat Saad bio Abi Waqqts (Allah be pleased with 
him) the Governor of Iraq, is as follows :* 

The movable goods whkh the troop* secured as spoils of 
war and deposited in the Army treasury, distribute them among 
those who took part io the battle, ai for the canals and lands, 
leave them in the bands of those who wort on them, so that 
income from them may £0 into . permanent fund to pay the 
salaries of Otherwise if we distribute them (Le. lands 
and canals) also among toe serving trocps, nothing will be left 
for the next generation. The bask: doctrine of this new settle- 
ment was that the ownership of these conqoered lands verts in the 
Muslim nation, the former proprietors are merely f«m tenants 
and that the Government Is administering thee* lands as agent of 

I. For a full ducussion on this subject radars tr e referred to *ti*i>- 
*hKJwt>i pp. 20, 11 « Q d Kiteb-ul-Amwat, pp. J7. 


the Mi*Iiqn,i ,« b practice the ri«bu conferred on the* Dhim 
In tbn case tho land wdl become Uih.i ri. e wi „ r" 

i'- Le,dtr) "-^ " 

0 dlMnbute the land and p rlTen ,„ te>V£ it in tbt h 
to nmer owner, a, H.dra, Um.r (Allah b. plc'Twul 

the Imam Aall hara no power to tak* ii , w ,» fronl itl own _ 

F«rAC.. w pp. .15, 36) 

The above three c«egori« of lend wore thoie whit-h m 

JB Umlc lytcja^U ier the., former owners were confirmed in their 
I. IMateiriu j. e . P l. tr ,*J b, tbe fo|iMpi0| C(a 7T~ 

proclaimed himself > Matin. »b er , ao _ H- ^.?T? r ^,1"'' Cafne ^ 
your Und re*.™ e^Adte * ^.e. f J * * 2 P ° lM «> *• 



title or if ondcT some circumstances a change was made, it related 
to control only. The system of ownership remained unaffected. 

We bave now to ascertain the policy of the Holy Prophet 
(peace oe on him) and bis Caliph* (Allah be pleased with ihem) 
in regard to ownerless lands or lands whose ownership had 
become extinct. Such lands consisted of two main types : 

One, 'MBwat' or fallow lands/ either those whose ownen 
had died or those to which do one ever had a title or those 
which had turned into bushy, marshy or flooded tracts. 

Second, 'Khalsa lands', those which were declared Stale 
property. This- included many kinds of land : 

(a) Land* which the owners had surrendered to the 

Government to use as it deemed necessary!, 
(to) Lands which the fslamic Governmet had declared State 
Property after evicting their owners, for instance the 
lands of Bent Nasr In the vicinity of Medio*, 
(c) Lands which were declared State Ptoperty in corfb.uered * 
arras such as tbc lands which were owned by Chosroei 
and the Royal family in Iraq, or lands whose owners 
hid fallen In battle or bad absconded and Had rat 
Umar (Allab be pleased with him) bad declared tbero 
as Stste Property 1 . 
We shall describe the orders is re/ard to these two hods 

Ownership Rights arising oat of coUnlsatioi. 

Reprding fallow lands the Holy Prophet (peace and 
blessings of Allah be on him) renewed the ancient rule which 
bad initiated ownership of land in the world. When Man began 
•to settle on tarth. the rule was "The Imd which one occupies: is 
bis and whoever has made a tract useful in some way, has the 
better right to use it." 

1. Ibn Abba* reported : "When the Holy Prophet (peace and blessings 
of Allah be on him) arrived in Medina, the Aosar transferred to nil charge 
alt landa whfcA were not irrigand by thtii water channel* in order that 'he 
tollhr m< ibesa *> he thought fit." {Ktiab-vl-Amvat. p. 211) 

2- laws Yusof and Abu Ubaid (ma? Allah show them mercy) Id tbe|r 
Works have enumerated ten eindi z\ iu=h lands. 


This rule forms the basis of . 

lh. tradit.on that whoever r«| 3iin , deld ,,„„ ( ' 
».«» ■n.b.d), acquire, proprietary rjght 0 Z ( ' it ';. Coi0 - 

(Ahmad Tirmidhi, Nasaf Jbn r u,». r 
••S.nn,r. b. Juodub reported that -h C Ho^Ch 
and bI«.m BJ of Allih be on him) had uj d • (PMW 
"Whoever draw, a bot.od.ry | ioe round , 01B> , 
■equina proprietary rigbc over it." (Abu Daw d, 

"Aamif b. Mudarris report* d that the Holy Pr „ p!lcI ( ' 
and bl.„| D g, 0 f Allah be on him) had laid • 
"Whoever find. , well which il not ,[,„ dy 0 
Miulim. .ball keep it." fAhn n? ^ 

"Urw. b. Zubalr (T.N.) say. : (AbU Dswud > 

ofAll.h be onbin,,h.d decreed tha, the l, nU 

God and the people heloos » Hin,. Whoso red! 

some .MUbad ha, pre-eropto-y right over j,. Th;s 

has been trao.mitted to us from the Holy Prophet' (nc- 

and bkaai.* of AIM be on him) by the „ me 

peraon. U. the i,| u „riou S companion,) ,„rough whom , be 

order of five prayers has reached u«." (A bu Dawodt 

Prophet (peace be on hi.) also framed two re g „| aIion "° * 
adm.nwter ,t One. he who coionise, land belonging l0 .no he? 

SSU W ^ °" ne,ShiP 0f 11 °° ' ht «"""' ° f " 'on 
»me land 0 r fl , es , 0w . 0Incf oa * M „ ^ ^ BOt \^ 



under uae, his proprietary rig*ht over it shall stand abolished si 
the expiry of three years. The Holy Prophet (pease be on him) 
has stated the first regulation at follow* : 

"Saeed b. Zaid reported that the Holy Prophet (peace bo 
on bira) had said : "Anyone who reclaims some wasteland 
shall keep it. But he who colonizes another person's land 
illegally has no right over it." 

{Ahmad, Abu Dawud, Tirmidbi) 
The second regulation is derived from the following tradi- 
tions : - 

"Tawus(Tabii) reported that the Holy Prophet (peace be 

on him) had said : 

','Ownerless land which has do trustee or heir belongs to 
Qod and His Apostle and then it is open to use by you. 
Hence anyone who icclsims dead land shall keep it ; and 
he who occupies it without using it shall lose his ownership 
right over it at the expiry of three yean." 

(Abu Yuiuf : Kttab-ul-KMaraJ). 
"Salim h. Abdullah (grandson of Hadret Umar) reported 
that Hadrat Umar (Allah be pleased withbim) had declared 
from the pulpit : He wbo reclaims dead land shall keep 
it ; but anyone who occupies it without using It shall lose 
his right of ownership after three years.'* 

(Abu Yuiuf : Kltab-ul KharaJ) 
This declaration was considered necessary because people 
used to occupy lands without working on them. There is a 
consensus of opinion among the Jurists of Islam on this rule, 
Whatever difference of opinion there is relates to the queition 
whether the mere act of colonization of uncultivated land 
makes the colooUer, Us. -pwoer or formal sanction or endorse- 
ment of the ownership title by the Government is necessary ? 
Imam Abu Hanifa (Allah be pleased with him) bold* the sanc- 
tion and endorsement of the ownership title by the Government 
necessary ; but Imams Abu Yusuf, Mohammad, Shan't and 
Ahmed b. Hanbal (rnav Allah show them mercy) are of the 
view that the verdict of the traditions is clear on the subject. 
So the ownership figbt of the coloaiwr is independent of the 

0WN£H5JiI? OF LAND )45 

sanction or endorsement by toe Government. He (the colonizer) 
" proprietor of his land by the authority of Ood and His 
Apostle. Toe Government'* task is to acknowledge (he right 
when the case is put up to it or to settle the question of owner- 
ship in case of dispute. Imam Malik (may Allah ahow him 
mercy) sets op a disiinctioo between dead lands in the vicinity 
o/ habitatloTii and those which lie far off. In his opinion the 
former are exempt from this order. As fnr the second ca<cgory 
of lands, the Imam's (Authority's) grant is not a condition for 
their Ownership. They become the property of a man by the 
mere act of reclamation. In this case the policy adopted by 
holh Hadrat Umir and Hadrat Umar h. Abdul Azir (Allah be 
pleased wiih th=m) wji that If a man colonized a laod thinking 
that it was waste, and laier aoother min came and proved his 
title to it, this latter man was given the option either to pay 
compenwtion for the work done by the cofoaizcr and take the 
land or to receive tb« price of land and transfer the owuerihlp 
to the colonizer 1 . 
Land Grants by the State 

The Holy Prophet (peace be on him) granted several (tu(:lB 
of both -Dead' and 'Cultivated State-land' to people and later his 
coJiphs (Allah 6e pleased with them; a r so regularly made similar 
land grant*. Several precedents of this are extant 1 a the corpus 
of Hadith and j«l anJ some of these are reproduced below ■ 

(I) Urwa b. Zubair (Allah be pleased with him) reports that 
Hadrat Abdur Rahman b. Auf stated that the Holy 
Prophet (peace be On him) had granted some lands to 
him and fftdrat Umar b. Khatab. Then i n Hadrat 
Uthman's reign, Zabair purchased from the heirs of 
Vm " thtir of land and sought coafWtion of this 
purchase from Uthmao, stating "Abdur Rehraan t». Auf 

+*m1 by Abu pa, 215-2 )f . S £ah All K£l ^ h£ x / 
i/wM/hiscollseceJairAhadithanH Pr«-.i- V "» h|i aW** 

vf Oesd Lands la Pan it trf this werkl. e « *nci 4B iailon 

M * BcoffoiDc rtmu of 

bears witness that the Holy Prophet (peace t* oh faunl 

Khatab. I ha« now purchased th«r share from Umat's 
Jew. Hadrat Uthman observed : "Abdux RahW 
bears true testimony, be it in his favour or against/- 

r* ai .. ... (Musnad Imam Ahmad) 

(2) b. Wail reports that his father (W au b Hair 

AUah be on h.m) had grained him a tract of 

e^ date-palms and other trees. Apart from this Urwa b 
Zubau reports that the Holy Prophet (peace be on him! 
bad panted hjm an Oasi. situated in the lands formerly 
belonging to Beni Nazeer. Furthermore, AbdunTb 

of Allah be on him) had granted another large tract of 
hod to Hsdrat Zubai, « the following minier The 
Holy Prophet (peace be oa him) told Zubair • 

Z^.T h T andlhC pdDt '^""of" -ball be 
the boundary of your estate. raced his horse aod 

when it stopped at a spot, he cut forward his lash. The 
Holy Prophet (peace be on him), then said : 
''AlfWght.givehimihelandupto where his lash has 
fB "™'" (Buknari, Ahmad Abu Dawud 

Kilab uUKharaj by Abu Yusuf. {Kit*b-ul-Amwai by 

(4) Amr b Dinar reported that when the Holy Prophet 
(peace and blessings of Allah be on him) arrived in 
Medina, he granted lands both to Abu Bakr and Llmar 
(Allah be pleased with them). 

(5) Abo Rafia states that the Holy Prophet (peace be on 
him) bad granted a tract of land to his (RafaVs) family 
J u ^«y « uW nrt wloite it (Abu Rafla) sold it for' 
MOODwari in the wigs ofHadrat Umar {AZJfib fee 

ownership of Land j^j 

hu land. Each tine he returned from his iouruev h, 

durmg h« ataence and the Holy Prophet ( be " 
him) Had .oued such and such . decree so he r!i, 
rutted. At last he cne to the Ho,y PtVhec (p cf^ 
on h lra) and submitted. "Thi, hasCouTe""^ 

(7) MU b. riarith Mueni re^ed tha, £^'££> 

(9) N.r. the son or the famous pb^= ia0 i^M.^ 
b. K.alda. repreiented to H.drat Uma, (Allah be 
pleased with him) thai . certain estate in Rasr. w*. 
nenher. tribute paying tract, no, was ,h. inur^Tf 
any Musi,™ involved in i,, *> i, ahould be ^ £ 
Urn and he would grow on ft rodder for hU 
H.dr.t tJm.r (Allah be pleased with hi*) "sueT. 
decree lo his Governor Abu Musa al-Ashari that if «,, 

£ZZ\ bv Nar ' w<re ,he 

granted to him. , r(i . . , . . 

(.0) Musab. T.,h. reported that Hadr.,' Utht'^S 

lands to Zubair b. Awam, Sari b as: iv. 
AbduUahb v Masud, U,a„a\ ^ Khtab^ 
Ammar b and b. Malik (AHah be piea^ 
WHh them). . WuM.0,„ a j . KUak . u , P 4mw ™ 



CU> Abdullah b. Hasan related that on Ali's application 
Urner bad granted to him (be estate of Uniey. 

(Kan* al-Ammal) 

(12) Imam Aba Yusgf relate* from several authorise 
sources that Hadrat Umar had declared all laadl for- 
merly owned by Kirra and bis family as state land*. 
He had also declared aa 'Slate Lands' those tracts 
whose owners. had abacooded or fallen in battle or 
which had become marihy, or were fl Joded or over- 
grown wjih bushea It was out or this land (hat be 
granted tracts to individuals. {^tab-vl-Kharai) 
SbarUh Regulations for Land Grant 

These land granti were not merely in the nature of a royal 

wbich we flad in the traditions and precedents. 

(1) According co the fir^t regulation if a grantee did not 

M ail ftftd for lQrec y* a ". "it grant Kood 
•boliahed. Ai a precedent imam Yusuf quotes the 
following iraditioa : 

Tht Holy Prophet (peace aod blenings of AlUb be on 
him) h»d granted some land to the people of the tribes 
of Mutaina and Juhaiua. They, however, left it fallow. 
Some time later it was colonized by some oiber people. 
In the reign of Umar <Al|»h be pleased with him) the 

uZ .Aui I"" 1 ,'" filCd * 5U " fM ' he recov "> of «■--■ 
Umar (Allah be pleased with him) observed ; 

"Had it been granted by me or Abu Bakr. I wourd have 
cancelled the grant. But this gram was made by tbe Holy 
Prophet {peace and blessings of Allah be On him). Hence 
I cannot rescind the gr«i. The law, however, 5raB ds 
Intact and rt is this : 

''Whoso has a land and keeps it fallow for three years and 
doe. not colour** it and later some mher people colonize 
j**j«d, then met* coloniser* have a better right to this 

12) Accordmg to the second regulation a grant which ia 
■ not being properly 0sed may be reviewed. As a pre- 


cedent of this Aba Ubaid iq Kitub-ui-Amwal and 
Yahya b. Adam \oAt-KMaraJ have cited a case which is 
« follows r 

The Holy Prophet (peace and blessiogs of Allah be on 
him) bad granted the whole valley of Aqiq to filial b. 
Harith Mitzni. But lie could B i>t bring a major pari 
of it under cultivation. Hadrat Uowr, therefore, j Q his 
reign said to him, "The Huly Prophet (peace be od 
him) had nor granted this lacd to you to Keep it fallow 
and withhold it from u« by others. So retaitvaa 
much of it as you cau u>c and leturn the remainder so 
thatl may distribute it amon^; ihe Muslims. filial b- 
Haiilh refused 10 comply with this advice, fjmar 
persisted is nit demand. Finally, except the land 
which was actually under hi* (BilU's) we, Umir (Allah 
be pleased with them) took away all the land from 
h.m and divided ,t i Mtt p | ols , wtuch were distr.buicd 
among the Muslims. 

(3) According to the third reflation (he Government's 
authority ts limited to making a ra D li only out of the 
Dead Lands and State Land*, The Government. h«a 
no power to snatch a piece of land from one pensoti 
and allot it to another, or to Transfer the estates of 
some ai fier lo another and reduce the r«al owoersi to 
Ihe position of tenants of the fiefo older 

(4) According to the fourth regulation the Goveromeat 

will make land grants to those persons ouly who have 
rendered some meritorious service Lo the society, or 
who are engaged in perfoim>Dg such service, or grant 
to whom may in some way suit the inteiest of the 
society. As for ihe undeserved Rnyal benefaction* to 
cup-bearers and flatterers, ox the gifts made by tyrants 
and dictators to the betrayers of public interest, they 
certainly do nor faU under the definition of lawful 

Correct Sbarjah Position with Regard to Fief* 

The two last-mentioned regulations are based on the over- 


A la ST h P t J !■ ' H ° ly Pr ° phCt " d bI « SiB 8* Of 

?L v m i " d h " " liphl <Attah bc P'««« **d0. 
Imam Abu Yusuf u h» book Kitab-.LKbaraj. explains tb«c 
(wo regulations as follows : 

-The Just Imam (Ruler) ha* ehc right to bestow upon those 
who render serv,ces to Islam sifu And rewards out oflhe 
properties which hive no owner or heir. When /-a— i**J 
( rulers) have granted some lacd to a «rson no 
one has the r.ght to rescind this grant. But the land which 
a ruler takes away from one pn 5ua . ad bes[DWs 0n another 

ht land which ha, heea expropriated from the one and 
handed over to another." 

Furtheron the Imam writes : 

•'Hence out of the above stated categories oflandi which 
(ha Imam cjq grant, ir the righteous Imam grants land, 
s.tuated Id Iraq, Arabia, Al-Jabal or other area, it is un- 
tawTuJ for later eal.phi to rescind those grants or to , Q 
ih.ra from thc.r current owner., whether they have inherit- 
ed those landi or have purchased them from the heire » 
Concluding the discourse Imam Yuuf observes : 
"Hence these precedents establish the fact that (he Holy 
Prophet (peace and blessings or Allah be on him,bin»eir 
made land grants and bis successor caliphs alio continued 
to do so. The Holy Prophet (peace be on him) invariably 
made land grants in the interest of welfare and improvement 
... to w,n tae heart of a fresh conveit or to settle, waste- 

that the grantee bad done some signal ser»i Cc Io ]#ram 
could prove useful against the enemies of Islam or wnen 
they deemed .t expedient to make a Mad grant." 

posKtoa of Jagirs (fiefs) and what" iS the c „ n of ^ 


taA! «er, yet it i, „« Uwfirf iBtbeOM ^ ev dMmr f 

ZvcrMH , 0Ul ° f ,ie P'"«"i« »Wcb they hive | he 

power to diipwe „f Bnd „ tbc , , h > « 

order «rt ai J n . n ? . m " tai " d tbe 

■dmi r ni,7r'., e " m r',' ""' """"M* P««M « picture of the 

of the n„™ h P "" ed t '" i """preted the Will 

of the Q U „D by precept and .«»„. Hi.!* S e„ this picture 

pnocple of M.mie admfni s ir«ioa of hod w a4 10 i" ' *? 
r ^T V ,V- m Pr i VSl ' 10 °*°«»bip. On the 

£»7^?T" r f r? ha ibio,ate '•"«■ «M«h 

l!h ^ " d " """K 1 " 1 «« correct mod. of 

ownership, n „ due l0 , hj . . ™ 

Ptophe, ( be oo him) LT™ y ™T,™™£lffi! 

indlv.dul.ud greoted the m ri s b„ „f owienbip 
ho.d.og,. Thi. „ . clear proof LhaHhc , aBd Iy ,L ^ 



prior to Islam was not retained as a necessary evil, but was 
confirmed a> a valid system for that, and the future ages. 

A further proof of ibis are the Holy Prophet's {peace be on 
him) injunctions to respecr the rights of owne/ship. Muslim 
ha* recocded a tradition from several sources in which it is 
sbttcu that in the lime of Marwan b. Hakam a certain woman 
filed a smt against Saeed b. 2aid (the brother-in-law of Hadrat 
Umax) stating thai he had expropriated a portion Q f land 
belonging kj her. Hadiai Saeed deposed thai how could he 
forcibly snatch the land of the plaintiff when he had himself 
heard fhrse words from ibe sacred tongue or Ihe Holy Prophel 
(peace be on him) i.e. 

"Whoso take* by opprt?nve means even such a small 

measuie of land as Lquals (he breadth of a hand, around 

lus neck shall be thrown a collar made of seven lengths of 
ibe same hod." * 

Muslim baa quoted traditions bearing .he same meaning 
from Hadrat Abu Huraira and Hadrar Ayesha (Allah be pleased 
with them). (Mu»]im; Wal Mu^ara Bab 
Tahr.m-uI-Zuiin Wa Ubasab-al-Arr). Abu Dawud, Tirmidhi 
and Nasai hayc recorded the following ttadiiion from several 
sources ; 

"Tfce Holy Prophet (prace and blessings of (Allah be on 
lnm) obseived : 

•*No one has the right (o cultivate the land belonging to 

another unless Le holds a valid right lo do so." 

Rati b. Khadjjreport.d that the Holy Prophet (peace and 

blessing? c) Allah be tn him) had ^aid : 

■;Wbo50 cultivates Ian; without its owner's consent, has no 

right the crop, but will be allowed « 0 recover b>$ cost 

(Abu Dawud. lhn Maja, Tirmidhi) 

Urwa b. Zubair rcpon-d that the !lo]y Prophel (peace be 
on him) heard a case in which a person had planted date-palms 
in a land o*r>ed by an Ansari. The Holy Prophet (peace be on 
him) ordered that the palms be uprooted and land restituted lo 
(be rca owner (Abu D 

What evidence do these injunctions bear ? Do they throw 



up tbc evidence that individual ownership of land was at, evil 
which it was intended to suppress yet it was tolerated because 
it was a neceuary eviJ ? 

Or do tfaese orders stand witoew that private ownership of 
iand was per se a valid and reasonable right, respect for which 
wai made obligatory upon both individual aud Slate ? 


Now look at ibis matter from anoiher anile. The laws of 
Islam are not contradictory or antithetic to one another. The 
Injunctions and Laws of Islam are Inier-conoccted and harmo- 
nious parts of one organic whole. This is an attribute which 
Allah has presented as the principal evidence of the Divine 
Origin of Islam. But if we concede thar Shariat holds tenancy 
(crop-shariog)" unlawful and that the lawgiver intends that a 
person should own oaly as much area of land as he can culti- 
vate with bis own hands and that the lawgiver obliges an owner 
either to make a free gift to someone or to keep uncultivated 
all land which is in excess of the area which be can cultivate 
with his own hands, thca a little reflection would make us 
sharply aware that these laws do not coincide with the other 
principles aod laws of Islam and aa attemot to fit them into the 
system or Islam would necessitate farreaehiai amendments in 
several clauses of this system. Note the following clear 
examples of inconsistency : 

1. Under the Islamic system, the rights of ownership ue 
not reserved for sturdy men only, bat have been conferred on 
women, children, the infirm and the old also. If Musarl'al ia 
forbidden, then the ownership of land by these classes becomes 

2. According to the Islamic Law of Inheritance, just as 
several heirs share the estate of a deceased man, so it some- 
times bacpeas that a single person inherits the estates of 
several qgeeased owners. How odd would it be then if the 

I, Muzari-at t i.,. The case where the Uo4 owned by oat fa enltivawd 
by another and both the owner aod ibe cultinror *h«r« thc piodl ™. m . 
is calkd Boxal {Crop irwinj) i d Urdu, 


™f tZ k\ inherUaace »POB n heir handred* of 

«r» ol laad belonging to deceased owner* and <ka A^r.*,, 

La. or n, am prohibit*, him , 0 profit b ' y Xb^H 

a limned acreage 6«d by statute. 

o= Jn m^ C „ I,UlniC L \t ° f SS " "* ?UKb "< do " "■« b »" « 
person .0 sell or purchase any specie of Uwfu| c0mBlo<ii( - 

TV l"" aali a ° m ° re - Thil ">»><«i"d right 

ofaMusl.m to sell or purchase ,„y , UMtily o[ r „ fll) eo * ■ 

module,, „ttpd. lo l aod s | S o. Here again it would be i„. 
coogruou; if cir.l law «i| o , e0 - , m , n ,„ t unlimited 
acreage of !.n d aid the agrarian law bin, to d„ 4 
economy advantage from all but a limited portion of hi, holding 
4. Isi.n, bas placed oo ceiling in ...pec, of quantity * 
miw ona.y type 0 f holding. There 1. 00 , imit on 
holdings acquired by uwftal means, subject to the condition 

Here is n, legal ceiling on the holding of money, anin,.],, 
tools, bouses, vehicles etc. Why then should land h. .„ 
tion to this rule. What spec i.^f. cor ^mVS 

,*sr 0 f iL o W p „^" x wh . ich in ' ,iB " the 10 «-* 

right or its ownerslup id terns, of acreage or to cut down tk. 
ow^e, , right to derive advantage from only . £.£ p., of 
b» holding, [e.vlug the rest a. virtually . dead low to him 

The on,y *,,,-.« W-pTuTbJK^'t ^ 
tory levies. For instance, eve. to a man who ba, paid 'h. 
Zak.t Wan, recommend, that he should giv. aw.yTll hi 
surplus wealth to the oeedy, but ,, doe. not prescribe JUC h 
generous conduct a, a duty, nor doe, it declare unlawful the 
act of giving money W the needy as a loan or m , ki ™ ; , 
.avestrccnt .a someone", business a„d becoming hi £ 
partner (Mudarbat).! weeping 

Ucour acd borb .b.r. a* |!ro£ "' njC " y " tf Ib ' 0(h « ""tribute, u. 


AtsliUncc should take the form of grant and free gift 
only. For instance Islam considers it highly commendable if 
k man allows Ms brethren free use of all bis spare bouses and 
eves spare accommodation j n the same house in which he 
resides. But Islam docs not enjoin it as a duly. At the same 
time Islam does not forbid letting out houses on rent. The 
same is the case with surplus clothes, utensils a D d vehicles in 
the possession of a nun; Islam considers it laudable if the 
owner makes a free gift of his surplus possessions to the needy, 
but docs not enforce such a conduct as a duly, dot declares 
the sale or hiring oat of surplus property as unlawful. What 
then is wsr>ecial about the Agricullnral property . thai isl ara 
should declare Jt an exception to its general rate and after 
exacting Zekat from its owner should also oblige him to donate 
his ffvplus land gratis to others sod forbid him to enter into 
any partership with others on the bails of Muzarbat 7 

6. In business, or Industry* fact Id ail spheres of econ- 
omic activity Islam allows free rein to a men to enter into 
active or sleeping partnership with others. A man can invest 
capital and become a sleeping partner ia another man's bus- 
iness. A man can invest both capital and labour and become 
an active) partner in a joint venture. A man can hand over 
his capital to another In the form of a building, plant, motor 
vehicle, marine boat, ship or aeroplane and ssy, " Work on it 
snd pay me a share In the profit according to this ratio." 

But what reasonable grounds sre there for asserting that 
a man should give bis land to another and must not any: 
"Cultivate it and give me 1/3 or 1/4 or 1/2 share of its pro- 


Q. Having read the Manifesto of the Jamast, a local 
scholar has raised two questions. Please answer then*. 

J. In the case of land reform measures whet is the ground 
for taking away all holdings in eice&s of statutory limit, 
especially when there is a precedent that the Holy Prophet 
(peace and blessings of Allah bo on bin) had granted to 
Hadxat ZuTjair a. tract of land ai extensive as his horse could 


traverse and beyond, oven as far aa be threw his whip. 

2.. Id the matter of evidiom of tenants, it >■ clear tbat 
eviction U unlawful till the harvest has been boras away. But 
except this, there is no other bar to evict ion. If there b any 
other bar. please explain with arguments. 

la answer to the first question. It must be borne in mind 
as a rule that the ownership eights of fief-holders over State- 
grants ofland are not of the same nature ai the ownership 
rights of those who purchase or inherit land. In the case of 
fiefs, the Government at all times reserves the right of review. 
On ascertaining that » certain grant is unfair, the Government 
can rescind or amend it. Several precedents of this are extant 
Id Ahadith and jUT historical evidence. The Holy Prophet 
(peace and blesiings of Allah be on him) had granted to Ibeaz 
bin Hamaal Maiini a tract of land in Meib, *hich yielded salt. 
Later it was brought to the notice of the Holy Prophet (peace 
and blessings of Allah be on bim> that the tract contained a 
large salt mine, whereupon, deeming it to be against public 
interest, the Holy Prophet (peace and blessings of Allah be on 
him) rescinded the grant. This does not only lead to the in- 
ference tbat State grants of land may be reviewed but a "so that 
it is against Public interest to make an excessive grant to just 
one person and if such a grant has already been made it must 

be reviewed. . ,«.»«■ 
Tbc same rule is established by the tradition in which it 
is narrated that Abu Bakr (Allah be pleased with him) wrote a 
decree granting a piece of land to Talha and directed Talha to 
secure on the decree the written witness or certain people in- 
cluding Umar. When Talha went with this request to Umat, 
the latter refused to put his stamp on the decree, observing 
"What! shall such a large tract of land be granted 

to you alone and others left deprived.'* 

(See Kltab-ul-Amwal by Abu Ubaid pp. m, 276) 
As regards the case of Hadrat Zubair, the grant was made 
to him by the Holy Prophet (peace and bleasingi of Allah be 
on him) at a time when far too many large tracts of land lay 

owxmsxr or land 


fillow and the problem was bow to settle them. Hsoce at that 
time the Holy Prophet (peace and blessings of Allah be on talm) 
had freely granted large tracts or waste-land to several people. 

Ob the subject of eviction, the Government hat ibe power 
to enaet a la-? thai no land owner can eject bis tenant on re- 
asonable grounds. What h the bir to enacting such a Law? 
Well, if a text of the Quran does not forbid making such a taw, 
rhen It follows Inat ibis power is included among those powers 
of the Imam (Authority among the Muslims) which he must 
exercise to establish justice among people, remove cau&es of 
social discontent and serve public interest. To-day when a 
van majprity of our popdition entirely depends on framework 

as a would be clearly againit public in- 
jsrest to give free rein to the landowners to evict their tenants 
at will without reasonable csuta. This wonld cause disaffection 
smong tillers of the soil and the lives of tens of thousands or 
agriculturists will always remain unsettled. 

{Tatjumarut-Quran, June, 195 1). 

1, The form ofCrop-shaHng in which the owner and the 
tenant divide the crop according to a fixed ratio say 2/5 for 
the owner and 3/5 for the Una of, is in principle, unexception- 
able. However, to meet the ends of justice it is imperative 
that the owner should give t 0 the tenant for cultivation at (east 
that much area or land, from whose produce he can gain 
sufficient share to meet his needs. Further Justice and not 
enstom should determine the actual amount of investment by 
tbc owner and the tenant in the production of the crop. No 
universal rule can be laid down on this head, Tor agrarian 
conditions vary : o each region. Certain it is, however, that if 
the owner gives the land only and„ the tenant's investment 
consists of seed, implements, labour and the rest, the share 
ratio of 2/5 and 3/5 is not equitable. At any rate it is essential 
that i he landowners should not only conduct their dealings 
with tillers according to th- dictates of Sharia, but aiso re*o]v e 

bcowboc ntiu op blah 

to do liberal justice. 

2. It is the established right of the land-owner to watch 
that the tenant doe*. not misappropriate the harvest before 
division and also to see that the tenant perform* hie farming 
work honestly. But this supervision ihould not be calculated 
to reduce the tenant to the position of a serf or a labourer to 
be driven by the whip of the landowner's foramen. In prinoi- 
ple the tenant is neither the land-owner** serf nor « labourer 
in his employ, but bis business partner and it is in this capacity 
that he should be dealt with. One or (he tenants* complaint* 
brought to my norfce is that the H ad-owner and hi* for omen 
constantly keep them under surveillance and Interfere in ev.ry 
part of their work. If is this wrong which I teak to remedy. 
"Give not unto the foolish (what is in) your (keeping 0 f 
their) wealth, which Allah hath given you to maintain- 
but feed and clothe them from it. and ipeak kindly unto 
them. Try orphans til! they reach the marriageable ago- 
then if ye 6nd then or aouad judgment deliver over unto 
them their fortune ; tad devour it not by tqnaadermg and 
in haste lest they should grow up whoso (of the guardians) 
ii rich, let him abitain generously (from taking 0 f the 
property of orphans) ; aod whoso is poor lei him take 
thereof in reason (for his guardianship). And whan ye 
deliver up their fortune unto orphans, have (ihe transi- 
tion) witnessed in their presence. Allah sufficeth ■» a 
Reckoner." (An-Ni.a : 5, 6) 

These Ayat beir wide meaning. They contain a compre- 
hensive Order for the Ummat that ihe means of production 
should not be allowed to remain in the hands of an unenlight- 
ened class which by misusing those mean* will disrupt - the 
social nnd economic order of society and erode the moral 
values. The right of ownership of property is not unrestrained. 
If the owner is wanting in ability to nse hla ownership right in 
the correct manner or so exercises tbis right as to create social 
strife, his ownership is liable to prescription. 

Every man must be provided, with basic need* of life, bnt * 


limit must be set on the free «ctci» of his right of owner- 
ship ; so that Ibe use or (bis right does not pose . danger to the 
moral, social and economic order 0 r life. l 0 accordant with 
tbjj lajtmcUon »t tbe individual level, cverv man of wealth 
rouat lake care that the person to whom be is eDirusting hi* 
wealth has the requisite capacity i 0 use It wisely. On a higher 
plane, the Islamic State must take steps In nationalize the 
property of those who maqage it inefficiently or unwisely apd 
the wealth or those who expend it in evil way ,. | n (his case 
tbe slats must, however, subsistence to ibe owners. 

It his also been directed in these Ayat that when the wards 
are approaching majority, the guardian, administering their 
property must assess the mental capaciiy and development 
of sound judgment io the wards. Two conduions have been set 
for handiDg over thoproparty to the ward. On,, attainment 
oftho age or majority;. two, soood judgment c * pBCjlv 
for right use or tho property. 

The legist* are ueaaimoua on the first condition *■ 
regards the .ccond. Icn.m Abu H.oira (may Alt.b show bim 
mercy) b<rfd» that If on attaining majority the orphan ward 
lacks sound judgment, the guardian should wail for a maximum 
period of 7 years, at the expiry of which he must hand over 
the property to his ward even if the latter is devoid of sound 
judgment, imams Abq YW, Mohammad and Shaft (may 

£a fr "7™^ ° f tbc •P-l- tba* possession of 
soond judgment by the ward is an essential aod inevitable 
condition for handing over the property to bim. The latter 
group of, would peob.bly consider It judicious to refer 
ihe matter to the Qadi (Judge), and ir the Qadj ascertains 
beyond a shadow or doubt that the ward lack, sound judgment, 
he ahonld I order the creetioo of proper agency for the ... 
agement of the ward's affairs." 



1. UAam+bQ***, Vol.1, pp. $22, ffl. 


[Maulm Mtoddowtl b» wrliuo a comprcheaalvc book oa 
Xha topic. in wbicb he baa dealt with *!l Ibc cuentJal aspects 
of tbii qoestjoa from i rational, historical tad abarlah pic*, 
point- Survoyini the history of Modem Banking, be fau 
established that loteresc ii tbe worn loftrumeot of Bconcmic 
profit aodeaploliaiton. Prase-filial, a total refutation of tbe 
false doctrine which diiclniulshrj. between commtrcla) and 
non-coramerclal Imercar, tc* book |i*« tbe basic outtlnt of *a 
iat«ruirr«« 1:000017. Ao exBiostive nudj of tbe corneals 
of this book ii a cum for aU icodenis of Ecooomica. The 
present work reproduce* only a few topic out of thii book and 
some imponam discourses from Tafliim-ul -Quran 1 and Kunlt- 
a-Vajeff*. Foi full coraprcbensioo of the subject, however, 
recooraa must bt bad to the orlfjoii work. — Editor.) 


To begin with we shall try to understand what according to 
the Quran and Sunna is (he definition of Interest, wbat are tbe 
laws about it and to what transactions do the prohibitory 
laws of Islam apply and finally having eliminated 'Interest,' 00 
what pattern doea Islam intend 1q regulate the economic affairs 
of man. 

Tha MeaaingofBiba 

The Holy Quran uses the word fiba to denote interest. The 
root of the word is J which covers the mean.ii.Bs "Excess", 

"Growth", "Increase "and "Rising". The word l£ means 
" grew and increased 

Tbe «preaaion wj signifies "He ascended the 


1. Adopted from interest. • 



The sentence j^JI a* Vj sats, "Re poured water oo 
.rinded barley atf It swelled." 

" w* "o " ™ J 8^w up b j ap of that person/* 
t/.iJI ^fjl Is the equivalent of " Increased the thing," 
•jfj denote* M Rising 

' meant "Rising above the ground level." 
Wherever these word* originating from the sane root hive 
been used In the Holy Quran, they carry the meaning of 
"Excess," "Addition and "Growth." Forinatance; 

" When we send down water thereon, it doth thrill and swell 
and put forth wry hvfty kind of growth " (22 ; 5) 

"Allah hath blighted usury and mwJe almsgiving fruitful" 

(2 : 276) 

"and the flood bearethfon its surfece)*wWW*g foom. \\l ; 17) 
"therefore did He grip tbem with a lightning grip " (69 ; 10) 

So that one people might take undue advantage over ,b, 
other." (16 : 92) 

" We gave them (Mary and Messiah) refuge on a htight" 

(23 : SO) 

The word Rihm springs from the same root. It denotes "Bx- 
oeasLOD to wealth and an addition to the principal."" 

This meaning has been explained by the Holy Quran itrelf : 

.-.And give up What remained (due to you) from usury 

And if ya repent, then ye have your principal (without 
interest)- (2 : 278, 79) . 

''That which ye give in usury in order that it may tncrea** 
ontothcr) peoples' property hath no incnau with Allah", (30 : 30) 

These Ayat make it explicit that any increase on the principle 
•ill be called "Wte- But the holy Quran has certainly not 
declared every kind of 'increase unlawful.' ' Increase ' is obtain- 
ed in trade also, The ' increase ' declared unlawful by the Quran 
js a certain type of increase which it refers to as Riba, 

im BcoKOKic STfmc op blah 


Tbb term was used by the Arabs to denote (he tame type 
of increase even before the ad veal of Islam. But then the pre- 
Id&iaic Arabs considered tb?s kiod of increase as lawful as 
Increase by trade ; just as peopte do in the ignorant world of tbe 
present times. 

Islam taught that increase in the capital by trade is different 
from tbe increase which is obtained by Riba. The former is 
lawful, tbe latter, unlawful : 

" That is because they (the swallowers of usury) say: Trade 

is just like Usury; whereas Allah permitteth trading and 

forbiddeth usury." (2:175) 

Since the term Riba signified a particular type of excess 
which was commonly known, hence the Holy Quran did not 
elaborate on it and said only that Allah forbids it, heace 
abolish it. 

IUba In the Period of Ignorance 

Several kinds of transactions to which the term Riba applied 
in the period of Ignorance have been recorded to tradition. 
Qatada wys : that Rita in tbe period of ignorance bad this form : 
A man sold a thing to another and allowed a certain period of 
grace for payment. If the payment was not made and the period 
of grace expired, the seller allowed a further peiiod of grace but 
increased the bill. Mujahid (Allah's mercy be on him) reports that 
in the period of Ignorance Riba bad this form : A man borrowed 
a sum from another and pledged himself to return an excess 
amount if the lender gave him a certain period of graced 

The conclusion of Abu Bakr Ja sn is (hat when the ignorant 
people borrowed from each other, they made a coniraci that at 
the end of a certain period of time a*fixed amount shall be paid in 
excess of the principal. 1 

According to tbe research of Imam Razi (may Allah show 

him mercy) the -ustom of the ignorant people was that they lent 

a person some amount for a certain period and then received 

from biro a fixed amount as interest each month At the expiry 

- _ 

I. {IbHl-Jarter, Vt>\. tit, p. &} 

t, iAHiom+hOvroR. Vol. D 


of tho stipulated period of tint the lender demanded hi* 
principal. If the borrower defaulted, another period of time 
was granted and the amount of mlcrcst was enhanced! 

S** b«ines* traoiaacrion^ were common in Arabia .or* 
the A.«b8 retoed to them u Rib*. It is theac transaction, which, 
were pcojcribed by the Hory Qurao. 

lie Bute Difference Bet wets Trade/Sate & eod *fAa (Usury) 
Ut ue now consider the basic difference between Sere 

^"7' ,h " of usury which difTerenticte it 

from AW;. (Sale), and the basis on which Islam forbids usury. 

The term Baly' (Sale) sppUes to a transaction in whiefa the 
seller offer* a thing for sale. The tmycr . nd the seMer came to an 
agreement on (he price of that thing and in return for ibis price 
the buyer takes possession of the thing. One of the two conditions 
is essentially present in this case. Either the seller baa created that 
thing with nil labour . 0 d investment or he had purebred f» 
from someone else. In both case* he adds his labour to hi. 
r^oclpaj which be used U purchasing or producing the thing, 
This labour gives him a nght to profit. In contrast to this the 
transition of Ribu (Usury) takes this form : A man lends his to another man .nd seta the condition that be will 

receive a fixed amount over end above the principal at the end 
of a certain period of time 

In this case principal stand, counter to principal and the 
period of tune is equated with (be additional amount which has 

^T-^ i ^" 1C ° Ddi(iOD ' R ***ie*dItlo*«i amount 
which * called Riha or interest. It is not the payment of a par- 
ticular commodity or thmg; but the payment against time 

If in the sale agreement it is set down as a condition that 
uTtbe buyer delays payment say by one month the price wii! be 
enhanced at a cettain rate and In case of further delay another 
surcharge will be payable, this excess will also fell under the 
definition of Interest. Hence Interest is to be defined as 
follows, " Interest is tor excess amount on (be Principal which 
is revived at a fi «d rate after a fixed period, both conditions 

I. Sea Taftir tobtr. Vol. a p . j~$7 — 



being predetermined." 

Excess on the Principal, the determination of this excess 
according to the period of time, and excess being a condition of. 

the transaction these are tbe three ingredients of Interest. 

Every transaction id which these three ingredients are present is, 
s usurious transaction, regardless or the consideration, whether 
the loan was taken for productive investment or to meet a 
private need or whether the debtor is rich or poor. 

The basic difference between sale transaction (tf) and interest 

(1) Id sale transaction the exchange of profit between the 
buyer and the seller takes place on a footing aC equality, 
for the buyer takes advantage of the thing which he ha* 
purchased from the seller and the seller receives compen- 
sation for tbe labour, intelligence and time which he has 
expended in procuring the thing for the buyer. In' 
contrast to this in a usurious transaction the exchange 
of profit does nor *ake place on an equal fooling. The 
usurer takes a fixed amount of wealth which is a secure 
advantage for him. On tbe contrary the interest- payer 
obtains a period of time only whose productivity is not 
certain. If the debtor bas obtained the loan to meet 
bis private needs, then the period of time he has secured 
kceitainly non-productive. H he has taken the loan 
to invest in business, agriculture, industry or trade, then 
tbe chances of securing profit or incurring loss within 
the given period arc even. The lender in any case takes 
a fixed portion of the profit whether the borrower is 
earning profit or incurring loss in his business. Hence 
the usurious transaction is based on either the profit of 
One party and the loss of another or oa the certain and 
fixed profit of one party and the uncertain and indeter- 
minate profit of another. 

(2) In business bargaining, the selfer takes profit from the 
buyex only once, however high thar profit msy be. But 
in the case of usury, tbe lender continuously receives. 

profit on bis principal and the rate of profit $o« on in- 
creasing with the passage of time- Whatever the amount 
of profit that the borrower nay have earned on the 
Principal that profit carjnot exceed a certain limit, but 
profit that ihc lender earm on bis principal, know* no 
end. The profit of the leader may suck in the entire 
earnings, means of income and even the household effect* 
of the borrower, and yet not come to an ecd. 
. <3> In business bargaining tbc transaction closes with the 
exchange of thing and its price. The buyer has no 
obligation to discharge towards the seller after the 
completion of a bargain. 

la the case of usury, however the borrower first exhausts 
the principal and then he has to regain it and return it to 
the lender with the addition of interest. 
(4) In the field of commerce, industry and trade and agricul- 
ture a man earns profit by investing his labour and 
intelligence. Bui in the business of Usury, a man lends 
out his superfluous capital and without putting in aoy 
effort, labour or expense, becomes a dominant partner in 
tbe earnings of the borrower. 

He is not a partner io tbe actual sense of the tetm.becauie 
a partner shares both in tbe profit and tbe Loss, and 
lake* bis share in proportion to the votume of the profit. 
Tbe usurer on tbe other hanJ i* a partner who claims a 
fixed rate or profit without rrgard for profit or loss or 
the volume of profit in the business. 
The Cause of Prohibition 

It is due to these reasons that Allah has declared trade 
lawful and usury unlawful. 

Apart fiom these reaa jns thee arc other causes for the pro- 
scription of interest. Usury develops miserliness, selfishness 
callnusnass, inhumanity and financial greed in the character of * 
man. It drives a wedge between nations. It severs the ties of 

sympathy and fraternal cooperation between Individual within 
a nstiou. 


It creates a tendency among the people to hoard money aod 
spend it to promote their private interest only. It blocks the 
free circulation of wealth in the society, and diverts the flow of 
money from the poor to the rich. Because of usury the wealth of 
the people at large accumulates in the bands of one class, 
which finally leads to the destruction of the whole society, as 
every teamed economist knows. All these evil effects of usury 
are irrefutable. This being so, it is alio an undeniable fact that 
usury negates every part of the system which Islam presents fo: 
the moral training, cultural reconstruction and economic 
organization of humanity, aod that even the smallest and appar- 
ently harmless form of usujioas business deforms the entire Islamic 
system. That is why Allah has itriotly prohibited usury in the 
severest terms : 

Fe«r Allah and give of that Interest which is still due to 
you, if you are true Belivers ; bni if yon do not do so, then 
.you are warned of the declaration of war against you by 
Allah and His Messenger, (2 ; 27B-79) 

Th. fkTerliy of Prohibition <m Ihmrj 

The Holy Quran forbids many other sins also and warnings 
of condign punishment for them have also been given, but in no 
other case have such severest terms been used as ha tbe prohibition 
of usury. 1 

It is for this reason that the Holy Prophet (peace aod 
blessings of Allah be on him) exerted himself to the utmost to 
suppress usury in the Islamic State. The agreement which he 
(peace be on him) signed with the Christians of Najran contained 
ao explicit clause that if they indulged in usury, the agreement 
would stand abrogated, and the Muslims would be constrained to 
fight with them- The Banu Mughira were notorious usurers i D 
Arabia After the victory over Mecca, the Holy Prophet (peace 
and blessings of Allah be on him) abolished all their interest and 
wrote to bis agent in Makkah that if they did not give up usury, 
«he should make war on them. 

1. Tht wordi of one tradition tie "tbe sin of usury ii seventy deartu 
Uitr ihan incest with one's mother. M (lbc-t-MaJa) 

The Prophet's owq uncle. Hadrat Abbas was a big money 
lender. On the occasioo of ih= Farewell Hajj, the Holy Prophet 
(peace b« od him) declared that "all interests on loans taken 
during the period or ignorance ttind abolished and I abolish all 
interest on the loans advanced by my uncle Abbas." The Holy 
Prophet (peace be on him) went so far u to say "O he who rains 
inkreat and he who payi it and the scribe who writes the contract 

of usury and he who witnesses it upon alt be the curse 

of Allah I " 

The aim Of all these order* was not to ban a particular kind 
of usury (the money-lender's interest) only and keep the door 
open to ail other forma of interest 

Their real objective was to liquidate capitalist norms of 
morality, capitalist mentality, capitalist culture and capitalist 
economy and to establish in their stead a system in which 
generosity took the place of stinginess, sympathy and a 
cooperative spirit replaced selCthocis, Interest gave place to 
Zakat, and the Bank was replaced by National Exchequer and 
tbua to uproot all those problems for the resolution of which the 
capitalist system fine takes recourse to such devices as Cooperntivt 
societies. Insurance Companies aod Provident Funds and finally 
succumbs to the unnatural system of Communism. 


So far we have considered the piecepts of Quran and Sunnah 
on the subject under discussion. We shall now review the topic 
on a rational basis. 

The first point to be determined is: Is Interest really .a 
reasonable thing? 

Ia a man really justified on rational grounds to claim interest 
on bia tendings? Does Justice really demand that the borrower 
must return some Inte/est in addition to the principal. Thia 
is the foremost question in this discussion and its answer " 
•settles half the issue. For if the Interest is a rational thing 

I. Adpoted from S&a u- i-rui) bj Maulaoa Syed Abul A'ili Maaaadl 
Published by islssak Public«L»u Ltd., !■*«« PaUataa. 



the case for its prohibition collapses. But if no justification for 
Interest can be found on tbe ground of reason and justice, 
then (he only question which merits discussion is : Why should 
we insist on keeping in operation such an unreasonable thing in 
human society ? 

<«) CompeiutttloB for RUfc and Sacrifice T 

The first argument that is advanced in answer to this question 
is : A man who lends out his savings to another tales a risk and 
makes a sacrifice. Forsaking his own need, he fulfils the need of 
another. He bands over, to another, wealth from which he himself 
could have earned profit. :„> 

If the borrower has taken loan from him to fulfiJ a personal 
need, he should pay rental on tbe wealth, just as he pays rent on 
the house or fare on a yehicle. This' rental' will be the com- 
pensation for the risk which the lender runs by handing over bis 
money to tbe borrower, and also a return for the sacrifice which 
the kn<kr has made in providing a thing of utility for the use of 
the borrower. If the borrower has taken this loan to Invest in u 
profitable business then the render has the pre-emptory right to 
claim interest. After ail when the borrower is earning profit on 

the lender's money, why should the lender be dented a share in 
the profit ? 

This part of the argument that ihe lender runs a risk as well 
as makes a sacrifice is quite sound- But how does this confer a 
right on the lender to charge a f rice for his rick and sacrifice at 

the rate of 5 or 10% per annum, quarterly or per mensem ? The 
only reasonable rights that he has on the ground of risk are that 
be can take over a property of the borrower as a pledge, Of 
demand security for his loan i a the form of a thing or personal 
guarantee or refuse the loan. Risk is not an article of merchandise 
which may command a price, nor is it a house or furniture or a 
vehicle for which a rental may be fixed. As for sacrifice, it « 

sacrifice only as long as it is not turned into business. A man 
who wants to perform an act of sacrifice, should remain content 
with its moral dividends, but if he demands materia] benefits 
fiom it, it does not lie in bis mouth to talk about sacrifice. He 

should talk business and say on what grounds does he demand a 
monthly or yearly sum over and above his principal ? 

U Imlmu a penalty 7 

But the amount which lent out was superfluous (obis 
needs and tie was not making UJ« of it himself. Hence in this 
case do 'foul' has actually occurred for whicli be can demand a 

Is later esl teat 7 

But rent is charged oa those things which a person provide! 
and maintains for the use of the tenant by spending his time, 
labour and money While under the use or the tenant these 
things siuTer wear and tear and constant depreciation in value. 
This definition applies only to things of utility such as a house, 
furniture and a vehicle. So it is quite reasonable to charge tent 
on them. But by no « retch of imagination does this definition 
apply to consumer goods mch aa corn or fruie or to money which 
la only a means of piOThaawj goods and services. Hence it J* 
preposterous to charge rent do, them. At the most a lender can 
assert that he is providing an opportunity to another man to take 
advantage of bis wealth, hence he must get a share uf this 
advantage. Tfaiiisa reasonable proposition. But the question 
is whether tho indigent man who borrowed fifty rupees from you 
m order to feed his starving family is taking such a great 

advantage of your corn or wealth that you deserve a share out of 
this advantage at tbe rate of 1/16 kilo of corn or Rs. 1% per 

There is no doubt that the borrower is taking advantage 
of your wealth. It is also true that you provided him the 
opportunity to take this advantage, But by which priociple 
Of" reason, justice, economics and business docs this advantage 
arid the opportunity to take advantage acquire a price tag 
which increases in proportion to the severity or the borrower s 
difficulty and enhance* month b/ month and year by year as 

his period of hardship lengthens out. 

If you are not large-near ted enough to confer your super- 
wealth on a needy and caiamity-striuken person, the most 


nuouhfc ftat for ,ou to <J 0 to led out your mow 

reasonable for yon to refuse the loan. 

* Ul * hlt ^ of businew iMhialhat the hard.hip and 
4i8U« 8 of a person riould become year golden chance to make 
profit the iUTTiij and dying patient, a good opportunity of 
ihVwtment and tfae ever growing human misery your „a Q d 
possibility to reap richer dividend*. If there ti any form of 
»G,v,Lg an opportunity to take advantage" which carrie. a 
financial value, it ,. only when the borrower j. inventing the io,n 
in busme*. In such «« the ha. a right to say that I 


It ii, however, clear that capital by itielf cannot produce 
pront. It v.eldj profit only when human labour and intelligence 
-work, on it. Again even human labour and Intelligence doei 
not bear fruit instantly. 

The combined force of capital, human labour and intelli- 
gence produce, profit only after a crtiin period of time 

might result to lots or bankruptcy. 

vnlu™ ^ 7™ Or ^ « *» •Emitted, the 

volume and una of profit cannot be predetermined. Now bow 

can It be cowfered „ ci0M , tBM the lender , money ahpuld 
produce profit at the very initaot that human labour and 
intelligence begins to work on it, and oot only that but the rate 
and volume of profit should be fixed, while the truth i. that 
w,th the combination of capital and human labour the produc- 
tion of profit doc S not become certain, nor can the r ate of profit 
be predicted, r 
The only rational proposition that can be admitted ia this • 

VHtiVT ih * '° ifl " e,t Wb savin »» * * Potable 

venture should enter ,n to parsnip with the entrepreneur and 

tate txts share in profit or loss according to an agreed ratio 

How can it be a fair form of earning profit that inatead of 


eatering into partnership with a man 1 should lend blm ■ 
handed rapees and iay to him, "since you will tabs advantage 
of my money, so I have acquired a right over you that you 
a^oid pay me one rupee per month as [002 01 you are una* 
my money in your business" 7 

The question is, until the borrower hu added hli labour to 
the capital and has begun io earn profit wberefroni do- 1 claim 
any sham? If the borrower incurs loss instead of earning any 
profit, by what common of justice or tenon do I bave a right to 
teceive a monthly "profit" ? And ir bit total profit ia equal to 
Re. If- what standard of justice holds it right that the man who 
puts in bis lime, laboor. skill and private capital, everything in 
tfttt buincsa should receive nothing and I who had become • 
imping partner by giving bim Ri. 100/- should expropriate all 
mm profit 7 

Even an ox working an oil cxpelfcr all the day long bai at 
least the right to demeod its daily feed from his matter. But 
the usurious debt turns a □ uiineu-msa into inch an animal 
who afcoutd works all the day Jong for the lender but should get 

Again supposing the piofit of a buuncci-mao exceeds (he 
fixed sum imposed on bim as interest by the lender, even then 
by no stretch of reason, justice, business principle or rule of 
economics can it be justified that the business-man, artisan 
or farmer and all others who contribute any way in the process 
ofproducbonof thencccssiUcsofthetocjety, spend their time, 
endure hard labour, tax their brains and use up all their mental 
and physical energies, should look forward to aa-vocertain and 
indeterminate profit while the other man who baa only lent out 
fata savings should bask in the certainty of a fixed profit. All the 
others should face the risk of loss but this man should have a 
pure guarantee of profit. Their profit should fiactuate with the 
nse and fall oT market price. whi lc this man who ha* already 
determined h,a profit should receive it regularly month .by 



montb and year by year.l 

<b) CompraMtioa for tbe « Opportunity" and "Grant of Tim." 

The foregoing critical aaalysW makes ii explicit that the 
much-vaunted arguments proving tbe rationality of Interest, 
however plausible tbey may seem on the surface, begin to 
explode when examined in depth. 

As regards loans taltco lo meet private needs, there 
IS no rational argument imposing imereat on them at all, so 
much 5 o that the votaries of interest themselves have given 
up this weak case. 

As for commercial loans, he e 100 the votaries of in- 
teres: are hard put to answer the question ; vVfiat is the thing 
of which interest ia the prfcc* Besides ihc capital, wnai otaet 
lubstanual commodity docs the leader wb>ch cotitlci 
him to receive a fi«d monetary price, month by month and 
yearbyy^r? The identification of cbis substantial commodity 
is a complex problem for the votaries of interest. A section or 
tnem sa ys interest is the price of - providing an opportunity to 
lake advantage." But as elaborated 10 ibe above aD»l>sit, 
the proviaion of ihia opponent docs r.r: create any entitlement 
to a fixed, certain and progressively increasing price. On ibe 
contrary u enliUei the leader (o a proporuooate profit only 
incase the borrower has earned «iny profit. 

Another section shifts the potion a little and decla-es 
interest as the price of the - lime" which the leader grants 
to the borrower for making use of the capital. According to 
tbem. this "rime" has a value of its own and as its duration 
le ngthen out , its price goes on iai-icimng. 

1. One may have raise an objection how' can rSe'leodJng of a 
Cultivable land aM j ns[ a fi<ed 2mount he ji^iifVd wbea il it qoice similar 
to l«nd Jn g mooer on iotarest. Tfc.i c~.ez;,cr, cosccrni oolv ibosc who 
jaitiry a cerui n M( h deal aay Rs. »/. ot 100/- pa Ud*I in advance. I do 
not consider It pcroiaalbla or proper, rather 1 find il similar to iotcrcat ; 
aeoceBoaaolimailODof lL.ii objaetion H due in roe. Id my vie» crop- 
■barlni iuh. correct way of bargaining b«t*eca tbe landlord and the tenant 
axing Ibfiroroportkicatashaca in the crop yield. To me it ,. j U « like 
buitoe* pan-whip >nd tbe«fara pacomvbJe. 


From the day. the borrower invests tb e ]* an in 

be coodactad .1 ,11. Hence • time • i,, « deBnite v „ ue f ot 
borrower and be j. taking adMata.e „f „ „>.„ th , n , h ' , ' * e 
.ender be deaied . Al „« iB 1(m £££ » b * ,h « """"M 'he 

Fluctuations id the d Jra , l0n of ibis time certain!* r, i 

□ actuation, in lfl . p , ofi[ ralt „ lte tam 

.... d no, .h. fceder ,bc price of hi ."l"'' to ,t. loot .r .hort du.etico » a,: - 

But here 1,1, q the question is by what SD ur<-, , 
leader obtain the kaowLd* the, the L nc y be 

Farther, bow can ibe (coder be sure of a ce rial* „. 
of profit ia order to determiae bi, .hare ifi* " And 
□>..» h«.boorcomputia,,b.t,be t im e wh icK B . ? Wta * 
the borrower to a,.i, oflhe c. , " H.b ii ZT" 

-eaeonab,. ba.i, e „ u..^ ', ~£ ' ■»* 

ta» and proportlooate ,h„e h„| dlni and no^ L^fl?? 

•t .mpced at. pre-deterraiaed r»,c. W, " ch 
it) ASkaretaPtaetabilit,. 

A ,nl » d »««tiOflof lhe»oi.r«5ofJr,te £R .ihnM..h...t. « 

>n< e rc«-f Ml , blffl . fly jf- iflh .«Ji^ 

tfc« prodwiioo tod procurer,* r.r ^ ■» 

-Jo*, helps ta boost ttohZT? C J 0Mnm " *» d »- C.piuj 

cm be achieved and transported to profitable marker*. With- 
out the capital, (be level of production end the standard. U 
o^aijty decline* and acceea to better markets oaonor be 
™»- Tbu proves chat profitability if (ha natural attribute 
of capital. So its use alone establish** the rig ht oT Interest 

. But. In the first place, the claim that 1 Profitability - it the 
natural quality of capital is fuodameatally wrong, nil quality 
ia croatad fa ibe capital when it is invested by mam in ioni 
fruitful venture. Oaly la tbii caie can you argue that alnoe 
the borrower ii making profitable use of the capital, be 
should pay a part of the profit to the leader. But what economic 
value does capital create in the hands of a man who baa bor- 
rowed It to pay tbe Doctor's bill or the fees of the Undertaker T 
Is the lender justified In demaodiag «« share of the 
economic value," from lawfe a man? A B aic capital invented 
In fruitful ventures does not necrisarily create more value. It 
cannot therefore be claimed that production of value is the 
natural quali;y of capital. Excessive capital investment very 
often, has the effect of lowering the preflt margin rather 
than increasing it, So much so that It may even result ia lose. 
The cause of periodical crises in the bustueaa world to-day £a 
nothing else than excessive investment of capital ia business 
which boosts production. locrease ia production seta a down- 
ward trend in price*. Abundance of goods aud low prices 

using down the ma.gin of profitability of capital investment 
to ail. 

Furthermore, if capital at all has tbe quality of " profit - 
ability its coming into full effect depends on several other 
factors ; for instance tbe labour, ability, intellect and eaperience 
of Us users, suitable economic, cultural and political condition*, 
protection from ouniral calamities and international upheavals. 
These and other similar factors are :oe essential prerequisite! 
for the capital to produce profit In tbe absence of any one of 
Che above factors, the capital of:e 0 loses Its " profitability,** 
*»<h«r it turns into dead loss. But the money-lender neither 
1*k« the teaponiibtlity for fulfilling these conditions nor admin 


tbat la cue fail capital failed to yield profit due to lack of any 
of the above conditions, be would not demand his interest 
Instead be claim, that tbe mer e fact that aoaeone else 
.a using b» capital e B tit[ea him to • fixed percentage of 
interest regardless of whether hi, capital produce* any profit 
or not Even if « 0 do concede that ■■ Profitability " is tbe 
natural quality of capital and so the money-lender ia entitled 
to a ibaxe in profit, bow would we compute precisely the 
current rate of profitability so a* to determine a fixed rate of 
interest 7 

If we admit also that current rate or interest can be deter- 
mined by some formula of calculation, it yet passes beyond? 
©ur comprehension, bow could a money-leader, who advanced) 
m 10 year Loan in IM9 to some business firm at the current rate 
of interest end a 20 year loan to another business company- 
ascertain that tan or twenty years hence the profitability of 
capital will remain italic at tb» current rate, especially when ia 
UW the market of interest was quite different and in im ha<i 
further varied a great deal 7 

By what argument would a lender bo justified, who bad 
obtained from one company for ten years and from another 
for twenty yean an absolute undertaking that ha would fam 

ith\^lH9* " prOSpeCliv * proflt al ,he ™ P"«lent 
(4) CoaptnsaHoB for ''Time " 

Tbe final argument is rather more ingenuous, its substance 
Is: Man by nature prefer, the advantage, pleasure, enjoyment 
and comfort at hand to future advantage and pleasures Tbe 
more distant the future, the more doubtful its advantage 
and pleasure and the less their value in ones eyes. There 
are several closes for this preference for tbe infant over the 
distant. For example: 

(\) The futons is iDVisiblc and life is uncertain. Hence 
fnture advantage is also doubtful and man cwqia 
flsualize jt. in contrast to this, the net advantage of 
tbe present is certain and risible. 


economic mm or olaH 

(2) ThcimianlfumimcQtofhis need ii more vital and 
valuable for a needy person than the promise of* 
certain thing in the fotore which he might or might 
not need then, 

0) The wealth available to-day ha* practical utility and 
value. Hence it it preferable to the wealth which (he 
future holds in atore. 

Owing to the above reason* the advantage available at hand 
takes a precedence over the uncertain advantige of the future-. 

Hence the value of the sum which a man bnrrowa co-day 
is certainly more thin the value of the sun which will he return 
tomorrow and interest is that surplus value which when added 
to the principal brings the returned sum at par with (he bor- 
rowed sum. For instance, a mn solicits a loan of Rs. 100/- 
from a money-lender who settles (he transaction on this con- 
dition that in return for Rs. 100/- advanced to-day he will 
receive Rs. 103/- after one year. In this transaction actually 
Rs. 100/- of the present have been exchang ed for Rs. 103/- of 
the future. ( The amount Rs. 3/- represent the difference be- 
tween the psychological foot economic) value of the present 
and the future wealth. Unless the amount of Rs. 3/- is added 
to Rs. 100/- after one year, it will not become equal to 
the value wbtcb the lender bad givan to the borrower. 
One cannot but applaud the ingenuity of this argument. 
NevetthelPM, the difference that bas been pointed out 
bet. wee d the psychological values of the present and the 
future ja actually nothing bnt au illusion. Does human nature 
really consider the present a* more important and more 
valuable than the future ? If ibis is so why do a majority of 
people not consider it wise to exhaust all their earnings 
to-day and prefer to sive a portion of their wealth for toe 
future? Perhaps >ou will aoi come acroas even one pet oti 
of people who hive abandoned alt pue for the future and 
prefer io jpeud «H their wcslsh on present pleasure and 
enjoyment. At least W% people do withhold fulfilment of 
their present nerds to make provision for tbe future, for the 

Itan lb.t hi, r utore ,hoold be bright » P ' 

■ WWie futare. I, „ , different matter if > ma, do< , „ " 
of prance. a,n pi di, y o, u.d.r inflaence of ™™ D ° " 

Ju^^r 0 eqwa v o *■ ,oo; * u 2£ 

« iho end of the «cood yw fe. IM/- oT tl* pie *eoX 
Fort^MU . correct pri « ipI , tb« fl^™,,. diii/m tbt 

whirh J^, k!!?S! lt ° f J" - * ,f> dMr to,ou (hm| Ihc money 
*bich yon h«d obt«med tod .pent * i« £ time .go should with 

«np*ri»oa with (he mr»y in h«d, io eauch io that ma tf 
^ «o« * TO .peat R.. 100/-, tLT™,£ 
.bonJd Wine eqo*| io ft*. 250/- erf tb« preicnt ? 
"I ti wii ^wm" «rf Ibc Sal, tf 

•dvocattt of my pwieal t0 eg(fthJj ^ ^ wt|floa| . ty J£ 



justice of interest. The above crlttoism must hive revealed to 
roo that this impure thing ho* not the ilightcil relation with 


No ar^m«nt is weightier enough to isppiy a reasonable 
ground for receiving or paying interest. Bat it is s strange irony 
that the ?reB<crD scholars and thinkers included such an 
Irratioaal tbing among the established and accepted premises of 
their doctrines and assuming that rationality of Interest itself was 
an established truth, they focussed all their discussion, on the 
point that the rate of Interest should not exceed 'rational' 
limits! Yon will rarely find in modern western literature a 
discussion on (he validity of Interest itsatlf. On the other hand 
whatever debate you And among western writers relate* 
largely to these questions : A certain rate of interest Is 'unduly 
high ' and ' exceeds the limits ■ and la therefore, objectionable, 
and such 'fate of interest Is ' reasonable * and hence acceptable. 

But is any rate of interest really reasonable? Let ui for 
the moment ignore tho question as to how can a debate on the 
reasonableness or unreasonableness or the rate of a thing may 
arise whose rationality by itself is questionable? Setting this 
debate aside what we wish to know is : which rate of interest 
can be called natural and reasonable. And by what standard 
can a certain rate be regarded as fair or unfair? And is the 
rate of interest really being determined in the usarioos business 
world on any rational basis? When we investigate this ques- 
tion the fi"t Ta=t which appears before us is that no luch 
thisg as 'a reasonable rate of interest* has ever existed in the 

Many retra were considered reasonable in several epochs 
and later lir: same rates were adjudged □□reasonable. Even 
in the same period one rate was held resonable in one place 
and a different rate was considered reasonable in another 
place. In ancient India, according to a statement of Kautily* 
from 15% to 6*0% of interest per annum was held a quite 
reasonable and just rate and greater risk justified an e«r 
more elevated rate. 

In tbe latter half of the 18th and first half of the lytb 

banter, oq the one Wod And the Bast India Cotnpaay on (h, 
other cnoody. invoked interest rale, of 48% 9€<\^n*L 

/.bed War Lou. .16*% tattWpK,^,. 
between 1920-30, the Co-operative Society cn.dootod^ 
bealaee. le^ttfl, at 12 to 15% rate of interest. Prom 19*1940 
Ita- CWI Pnrto In the country Held 9% j D terete per annuo,™ 
perfectly reanoaable. Around the time of World War II the 
discount rate of the R motto Beak of India w« ftW at 3S1 

period or tm» wtr. Too Ooyerameni of Ind.a relied loana nn 
■t 2»/ ( % oer annum. *fmaeh f or our owncowineot - loofcin. 

rnidd o of the 16th Century 10% rate we* hold a, quit* 
onto in fingUad. Araoed the year 1920 tome CentreJ Banks 
Europe charted 8% or 9% end the rate at which the Lo.«o of 
Nations rnis* lono. for Europe Stetee we. ne«| y (ho 
But mention th)t rate of iale r„t to any body lo Boroiwi „ 
America today ud be will vehemently proteti "Thl. iVnZ 
interest ; it la oaked plunder" To-day the favourite rate 
of inter** OYorywhere i. J, or 3%. Four per cent i. eoa..dered 
the extreme limit. Under certain condition, the rate to-dav 
drop, down to I or 1/2 or even 1/4%. But on the other hand 
the Money-lenders' Act 1927 Id permit, banker, lo 
chargo opto 48% Interest per annum from the poor borrower. 

, ^l AnM 5?, n C ° Brtl tew «««mt rate, raoaioi 

from 30% to 90% per annum. The point ft which of the .bore 
ratea it natural and reasonable ? Let us go further and ew£re 
whether my rata or intereat can in fact be natural and Mini 
able ? 

When you deliberate on thla question, reason tell, yon that 

* fl "* «l» if the vain, of tho 

*ZLE£? t f0m . Ih ° b °" OWed ,um deienni«d(or 
determmable). For instance. If it were a settled fan that ,„ 

investment pfR.. 100/- for a year yields a profit JtS^Ht 


eoold then be said that, Re. 3/.orR,. 2}/. or Rs . .j,.^ 
natural «»d reasonable share of tbc profit for the tender 

But clearly the profit cm any sum thus lent out baa'nelther 
been determined nor can ever be, nor is the market rate of 
interest ever fixed on the consideration of what profit will the 
borrower earo or indeed whether be will earn any profit at alt, 
la practice, the money-lender fixes his rate of interest in pnv 
portion to the precarious* ess of the borrower's situation and In 
the commercial usury market the fluctuation! in the rate of 
interest take place on *omc other basis which do not bear the 
remotest connection with reason or justice. 
Factors which Determine the rate of later**! 

In the money-lending business the lender generally makes 
an assessment of the situation in which the intending borrower 
fa placed i.e. his poverty, bia need and the degree of hia 
distress, if he ./ere not provided with a loan. It is on these 
considerations that the money-lender determines the rate of bis 
interest, ir the intending borrower is not very poor, requests a 
small sum and happens to bo in no great misery, the rate of 
interest will be low. On the contrary the rate will increase in 
direct proportion to the hefght of bis misery and <b« extent of 
hi* need, so much so that if the child of a starving ram is dying 
of illness, the money-lender will not deem an interest rate of 
four or five hundred per cent as unduly harsh. In a case life 
this the 'natural rate of interest' is determined according to the 
same standard by which during the holocaust of 1M7 a Sikh 
demanded Ru. 300/- as the 'natural' price of a glass of water 
from a Muslim at AmriUar Railway Station, because the 
Muslims' child was dying of thirst and no one from the Muslim 
refugee train could disembark at tbe platform to get water from 
the tap. As for the other kind of Financial Market, there are 
two schools of Economic thought regarding tbe basis on which 
the Interest rate in this market rises or falls : 

One school holds that the fluctuation in the interest rat* 
follows the Law of demand and supply. When there ere 
investors and there is abundance of capital td lend, tho interest 


n» plunges down. When the rate is sufficient); low, an 
increasing number of entrepreneurs wishing to take advantage 
of the opportunity, begin CO apply for loans to invest in 
business- As the demand for capital grows and the market is 
depicted of money, (be rate of interest flies upward until it 
reaches a height where it stifles the demand for loans. 

Now. what does this mean ? 

The capitalist does not enter into a straight and reasonable 
partnership with the entrepreneur and aetile bis share in the 
actual profit of the business on a juit basis, instead be makes an 
assessment (hat the entrepreneur will make at least so much 
profit out of the business. Heoce 1 must claim this much rate of 
interest on the loan I am giving. On the other hand, the 
entrepreneur also makes an assessment that the money I am 
borrowing can produce this much profit at the maximum. Hence 
the interest should not exceed this limit. Thus the capitalist 
and the entrepreneur, both indulge in speculation. The 
capitalist al*ays mikes an exaggerated guess of the entre- 
preneur's profit, while the letter's hopes of profit are not unmix- 
ed with fears of Joss. Owing to this contradiction, there is 
constant conflict instead of co-operation between the capitalist 
and the entrepreneur. When ibe entrepreneur wishes to borrow 
in the hope of productive investment, the capital iit begin* to 
raise the rate of interest, till it reaches a level at which it is no 
longer possible for the entrepreneur to make profit on his 
borrowings. Thus when capital investment in business stops 
the wheel of economic development suddenly grounds to a halt' 
The entice business world is gripped by an acute crisis of 
depression. Sensing his own destruction, the capitalist now 
lowers his interest rate to such a level that the hopes of the 
entrepreneur to make proCt on his loans are revived. So capital 
begins to flow into Commerce and Industry and the Economy 
steps out of the crisis stage. This clearly shows that if the 
capitalists and the entrepreneurs cooperated with each other bj 
entering into business partnership on equitable basis the World 
Bconomic System could run do an even keel. But when Law 

tcoaoMic systxm op SUM 

rtself opened the- door to the capitalist lo lend out money on 
interest, a spirit of speculation and gambling entered into the 
relationship between capital and bu 3 io c «, lod ^ „ te rf 
Interest wu driven op and down by such speculative methods 
that ibe whole world groans under a perpetual economic crisi*. 

The second school of economists explain the determination 
of the interest raze as follows : 

' When the Capitalist wishes to keep hit money for bis awn 
Ms, he raises the rate of interest. A* this wish abates, the 
rate of interest also comes down. As to the question : Why 
does the capitalist prefer to keep his money to himself ?They 
answer that it is due to many causes. Some money has to be 
reserved for private < ( r business needs, and some has to be kept 
aside for emergencies or unforeseen needs i.e. for instance some 
extraordinary personal expense or unexpected arrival or a good 
business opportuniiy. Besides these two, there is the third 
and most important reason chat the capitalist prefers to 
hoard sufficient cash in order to avail of a fntore chance to earn 
profit in case of fall in prices or rise in the interest rate. The 
question which arises at ibis stage is : Is the desire, to hoard 
money crested in the heart of the capitalist by these causes, 
subject to waxing and waning, thereby resulting in the rise or 
faU of the interest-rate. 

In answer to (bis question it is alleged that a variety of causes 

personal, social political and economic often serve to enhance 

this desire. Hence the capitalist raises the rate of interest with 

tht result that level of capital investment la business falls. Some- 
times, due tt» the same causes, the desire of the capitalist to 

hoard money dwindles, hence he lowers the rate of interest. 
In consequence the entrepreneurs start raising loans to invest in 
business and industry. Just see what is hidden behind this 
plausible explanation. As for the domestic and business needs 
of the capitalist, his desire to preserve cash to meet ordiaary or 
emergency conditions, accounts for hardly five per cent of his 
capital. Hence it is not correct to give undue, importance to- the 
first two causes. Why does he sometimes withhold 95% of his 



cipLiilandwiDetinicspoaftiiliiio the «#dit market!* really 
accounted for by the third cause. Od analysis this cause 
nvnlt the fact that with extreme seloshness the capitalist 
conttnnea to watch the condition) prevailing i D ihc world, in his 
country and among his own people. Sometimes be foresees a 
certain situation in view of -bicfa he wiihca to keep himself 
armed with the weapon by miens of which he can exploit 
the hardships, calamities and afflictions of the society an d 
add to hft own prosperity by baxdeniog the community with 
more problems. Hence in order to indulge in speculation he 
withhold! bis capital, raise! the interest rate nod stops the 
flow of capital investment in business and industry, end exposes 
the society to the great disaster called "Depression**. 

Now when he perceives that he has bad his fill of plunder 

aadnoftifthereiploitatiooiipDwible. rather the proipect of 
low hai come nigh, then "the desire to keep his capful for hla 
own naa'* dwindle* in bls^itkediou). He throws the bait of 
tow interest to entrepreneurs and opens his vast coffera to the 
borrower!. Modem eoonomnti have expounded only these 
two theories of fluctuation ia interest rate, and both are valid in 
their own right. Whatever the theory, however, bow doe» it. or 
can it determine a "rca.ooahle- and -uttunV rata of interest. 
Either we shall have to transform the connotation of *' Reason** 
"Reawnability'' and "Nature" or shall have to admit that the 
causes that determine the rate of interest and its fluctuation are 
as unreasonable as the Interest is in, itself. 
The EcesMmk Benefit of Interest and its 'Need*. 

^ The advocates of Interest move on to another debate i.e. 
the Interest is an economic necessity and that it entail* certain 
esclaalve bene flu. The substance of the arguments which they 
advance in support of this claim is as follows : 

I. The entire buaioest of social economy depends on 
capital formation and capital cannot be accumulated 
unless the people save by curtailing their needs and 
desires. Saving is the only means of capital formation. 

a man be mauled to curb his 


and adopt Ok habit of saving unless he is promised a 
reward for self-control and sacrifice ? Interest is lfa« 
reward whow hope impel* people to saw. Therefore, 
irintereil is declared ualswful, the process of saving 
surplus wealth which ia the only source of capital 
formation will stop. 

The easiest method of luring capital into business is 
that the door should bo kept open for the people to 
earn interest od (heir savin**. 

'iQtercst* provides incentive to saving and again it is the 
incentive, of Interest which leads people to lend oat 
their savings to basineumeo at an agreed rate. If this 
door la barred, the incentive to save will evaporate and 
business will be denied even that little amount of 
savings that is already in band. 

Interest not ooly serves as an incentive to saving and 
pulls the savings into business, but also protects savings 
from unproductive use. 

The rata of interest Is the device which automatically 
ensures (bat capital should go into the most productive 
of all possible business ventures. Other tbast this. 
there Is so imaginable device which can sift productive 
venture* from (be non-productive-, more productive 
ventures from the less productive and can divert capital 
towards ventures of maximum profitability. The con- 
sequence of tba elimination of interest in the first place 
would be carelesa investments by the public and 
secondly, (he people will start making investmeots in 
all sorts of productive and non-productive ventures 
i nd iscximi oaiely . 

Debt is one of the inevitable needs of human life. The 
individuate require It to meet private needs. The 
businessmen need it often. Governments too cannot 
do without it. To what eitent can mere charity 
provide- large scale debts to this vast sector t If 
the incentive of interest ii eliminjttwd, the capitalist 


will hardly agree Co lend hi* money. Thus the removal 
of credit will have an extremely adverse effeci On 
economic life. After all a poor maa can tide Over hit 
. bad limn by raiting a loan from tbe money lender. If 
tto incentive of iolerest were extinguished, tbe poor 
man would rol to death without anyone coming to hit 
rescue. A businessman, when lie ii short of money, 
borrows oa interest and his business goes On running 
amootbly. If the door of credit were Cammed on him, 
be would come to tbe brink of insolvency many times 
over. Tbe same is the case with Governments. They 
meet the^r needs by railing loons on interest, otherwise 
where and how often will they hod generous financiers 
who would lead I hem millions without interest ? 
h latere** Really Necessary and Beneficial ? 

Let us now examine each of these "benefits" and "neccjsi- 
tiea w separately and see whether they ire real or only prrvcrs© 

Tbe first deception is tbit individual saving and capital 
hoarding is considered to be a necessary and useful factor of 
economic life. Tbe reality is otherwise. Actually economic 
progress and prosperity entirely depend on the rapid disposal 
of gross national production, so that the cycle- of production 
and consumption continues to revolve smoothly and at fast 
speed. This can only happen when people generally form the 
habit of spending all tbo wesllh they earn from their economic 
efforts, and when they are so magnanimous as to divert their 
surplus wealth to the deprived sections of the society so that 
they too may buy adequate amount of the necessities of life. 

Id contrast to this the advocates of interest teach those 
who have surplus wealth to economise (for economy they use 
such euphemisms as 'self-control', 'austerity' and 'sacrifice*) and 
refrain from Mailing a major part of even their genuine needs. 
In this way each person Is advised to save as much as he can. 
The advocates of interest believe (hat the benefit of thi R 
scheme would be large capital formation which would then ho 


jits «r itsrrjraj'.': ■ ,o ,b. dtpri ved .ection, of , ocie ™ °° 

prodncl or, me .ection of aociety who has enoiiBh. „r .urplus 
purchasing peer neither buy. a .. r£e portion of prod J™ 
nor transfer, the purehanng power l0 , hB deprlved 5ee , ioD1 
or the lotiet,. but continue, to withhold and accomul.te wealth 

ZT 7- t lbi ' iD pr0dUC ' ioa cvcle " 

portion of the Gross N.t.onal Prediction will remain unsold. 

Lesa con S umpt.ou will mem I... job., which will result in 

lku. ho.rdim of *,«l.h by . tiny minority will .pell economic 
dwter for a v«t majority of people. Finally the hoarder. 
f«r T .r'L ,he "" ,VM be overtaken by economic ruin, 

%£5>? ****** p ' 0<,ucM "" Ded out bv ,hei < »• 

eliminafe^" "'" T. ""' ,ta eCMOn,io » «• 

» rthold IT *,° d '°" DliV " " hich ind ' M WiTidutl. to 

" t h "l; ,d »«"«"'l»'e < earning, instead of .pending 

TL% -2? T*. d ,0Ci *' io " i,n,io '» b* est.bli.hed 

to t .nd.v.dual, ,, the time of hardship thus obviating « he 

need to save e,rn, DS i and on the other Zakat lbo ald be 

^- t^rWr MI i ll A par, of the wealth which 
remain, stuck despite ,he„ mtstaIe , .hould a. any rate be 
diverted to those who , c „ lv . . ims „ ,„„ e f[oa , he „,„.„,,,: 

1 „., '° ,hi * *• ™>"'«™ economist. ,h„ pe n 

• , ,n " ,D " of stinginess in »ome by the bait of interest and 
induce even those who .„ not Ming, to ms we a1.h instead of 

The capital tbus formed at the « peojc of collective pre* 
perlty n then channelled into productive venture* by do other 
means ib*o interest. This is anolhe-r crime against eoUceiiv* 
well-being. If ibis accumulated wealth wen invested in business 
on the condition- ihat the investor would take a proportionate 
share of the profit, even then it would have been tolerable 
But the capital Is invested on the condition that the investor* 
must have his profit at a fixed rale Irrespective of whether the 
businesa earos lessor more profit or no profit at all. In this 
w-iy collective economy suffers double lost. 

The first lo« occurred when the money was withheld from 
spending and accumulated. The second loss resulted from the 
investment of tbii accumulated wealth in economy not o» the 
principle of partnership but aa a debt on the industrial and 
commercial sector of the society.with a legal grantee of a fl*ed 

„r .IS !""!' ? yltc,ncr «" tM *« lu *^n b which, majority 
Of such individual, as command purchasing power do not use it 
in buymg th« oitlonal product., bat continue to heap It « 
Z *0Z!i b " r|Q « d ^pn^ety. The lociety 1. caught " 
he perplcung problem of how to repay this progressively debt .nd it. interest when the .Jo of ^modules 
produced by the aid of this debt becoming diOcult day by Ty 
M,Hions or people do not boy these commodities becW they 

b^u^hf 0 "'' Md * 0mn *' Df I*0P^ buy them 

because they conserve tQcir purcbaiing power iQ ^ ^ 

transform it into interest bearing credit. According to modern 
economut. one advantage of Interest i. that li contains 
the businessman to avoid useless expense of capital and 
utilise it in the most productive osnner. They mention it a. 
a villus of the rate of Interest that it acts as a mute guide and 
leader of business. 

from alt the possible .venue, of its flow the capital selects 
But lift this «rta,n of inllibilit, and see the reality hidden 



behind it- The first service rendered by Interest is that 
it abolishes all other interpretations of 'profit' and 'profita- 
bility' lave the one which equates 'profit' with 'monetary 
profit* and 'profitability' with 'materia) profitability'. In this way 
capital acquires a single track rciod. Previously it could flow 
into channel* which promised profits other than money. Now 
it goes straight in the direction of guaranteed monetary profit. 

The second service that Interest readers through its fixed rata 
ia that the yard-stick of 'proEablc use' of capital changes from 
Society's profit to the capitalists* individual profit. The 
rate of interest determines that capital shall be invested ia a 
business which can pay : ay o"/. or mure profit to the financier. 
"Projects yielding less than that rate do not qualify for invest- 
ment. Now supposing two project schemes are laid before 
the capitalist : One, thai houses, both comfortable and bearing 
cheap rent be built for the use of low- income seciiom of the 
society. Second, tb&t a magnificent cinema hall be erected. 
Tbe first scheme promises less than 6% rate of profit, the 
second holds far better prospccL 

In other circumstances it might have been possible for 
capital to flow foolishly toward, the former scheme or at 
least would have mide a loss between the two. But it is the 
"blessing" of the rite of interest thai it guides capital straight 
towards the second scheme aad makes the former scheme took 
so repulsive that 'capital' cannot bear to look at it. 

Another 'miracle* of the interest rale H that it constrains 
tbe business-man to use all means fair or foul, to keep 
hi$ profit rate above the interest rate of the money-lender. 
For instance if a man sets up a film company with capital 
bearing 6% interest per annum, he will have to resort to every 
means to maintain his profit rmte above this rate of interest. 
Jf be c*nDot achieve this cod by producing films of moral and 
educational value, he will "then be driven ro produce porno- 
graphic and immoral films aad draw crowds of fans by sensa- 
tional advertising calculated to arouse a storm of sexual passion. 
Thjs then is the real nature of those advantages which according 

to the modem economist accrue from He lutereU, and which 
cannot be obtained through a ay other means but the Interest. 
Ut us now examine the -need' wfaicb the modem economist 
say* cannot be fulfilled without Interest. 

There is no doubt that credit It one of ibe needs of human 
life, Individuals requiic ii fa, personal Deeds. There in i 
constant demand of credit io Industry, Business and Agricu- 
ture. All corporate iostitoDon* including the Government 
need loam Hut it la wrong to asaert tbat loan, cannot 
bo obtained without interest. Aa a matter of fact toe cause 
of the Don-avail ability of loans to individuals or the society 
without Interest ia that the L«w ha. sanctified Interest Pros 
crib* Interest and infuse moral values of Islam in yoor economy 
and you will see tbat loans for personal, business -nd s0c iai 

~»i! W,II u e ^ rth . C ^ ininiwUh0UtiDlere5( ' 0fly evca donationj 
w,ll be available. 1.1am Has already given its practical proof 

For centoriea Muslim society has be« n running its economy on 
the best model without Interest, prior to ttn. blighted usuriou, 
age it had never happened In the Muslim society that , 
Muslims corpse lay oaburied because bi, heirs could not mi™, 
a loan without interest, or the industry, trade „d agriculture of 
Muslims eolln^d for Inch 0 f eredi, without in,™, 
or the Muslim Governments failed to procure -money for 
pnbhc work, or Jihad becau* their citiren. declined to J vt op 
their capital without the attraction of interest. P 
Hence the claim of the modem economist that credit 

borrow^ can only be established on the fouDdacion of | Dte reai 
requires no logical refusion. We hev provC d It wron. t„ 
centuries by our practice. 8 for 



"Henceforth, if ou abstains from taking Interest .fter 

»^ • dB,00,ti0a h « t*rd. no legal 

action shall be fake, ngaru.t hi m regarding he intereat 
be had devoured before ; his case shall ultLVely go^ 


Allah. But if one repeats, the same crime, hesb&il 
go to Hell, where he shall abide for ever. Allah 

and Atlah does act like an uugrafefl, dotal pe«on ; 
.„ . J (2:275, 76) 

the E^mt w^h^i ^ * fa V H ° Wi " f °'* ivfl the *w for 
toe Interest which be bai mlready consumed. On the other 

hand it is affirmed (hit He will yd Judge his case. The 
lenience .hows efaact (be phrase 'no legal action shall 

2l\ h ' m re *" din « ,be ««rwfft he bad de- 

voared before does not coaaote that he has been acquitted 
It is only a legal concession t 0 the effect that the Interest has already been consumed shaU not be recovered 
by force of Law. for if a claim of recovery were preferred it 
WOUld give rise to an infinite number of suits."" On a moral 
plane, the abomination of wealth which a person hat amazed 
from u.urious business still remains. Tf that person really 
fearrOodand if bli economic and moral outlook has really 
changed after his conversion to Islam, then he will rifeta from 
spending his ill-gotten wealth od himself and will endeavour as 
fare* possible to search out the genuine owners or this 
wealth and return it to them, and where he cannot find the 
real owners he will spend (heir portion of wealth on social 
welfare. Only this conduct will save biro from the retribution 
of God. As regards the person who continues to enjoy his 
ill-gotten wealth. =t would not be too wrong to say that he will 
be punished for consumption or unlawful wealth. ' 

This Ayat revert fl (rath which Is real in all respects 
moral, spiritual, economic and cultural. Although, apparently 
Interest increases wealth and charity decreases it, yet in fact 
contrary is the case. The natural Law established by God is thai 
loterest not only hinuvrs moral, spiritual, economic and cultural 
development, bat becomes the cause or downfall. 

In contrast to this, charities (lncIadicg.£*rrfffe M « charitable 
loan) bring about moral, spiritual, economic and cultural growth. 

Judged from a moral and spiritual view-point it is cleat" 

QiTB-Un l£| 


that Interest has ill genesis ia iel5shae», atlngiocsa, narrow- 
mindedness and callousoess, and it ii these qualities which 
Interest develops ia human character. 

In contrast charity spring* oat of generality, sympathy. 
laric-heertcaneieaodnagoaQiinity and it ia tfaeae qualities which 
continuous charitable condoct tears in a haman being, who 

ii (here who doea not regard the first Ht of qualities as the wont 
and the second as ibe best ? 

Jadgiog from the poiot of view of culture a man will 
readily understand that a society whose members deal self- 
tahty with one another, in wbioh no one misiits the other save 
ont of selfishness and the motive of personal advantage, in 
which one man'a need is considered a heaven-sent opportunity 
of profiteering by another man. in which there la a contradiction 
between the Interest of the masses and the interest of the 

affluent clMJaa-iuch a society can aever ba auble. Not ^ 
but mutual hatred, envy, caltoat-netf and indifTerance will grow 
among member* of this society. The components of thj. 
society will always be Subject to centrifugal forces of chaos and 
disintegration, and if other contributory causes exlat, a violent 
clash between different sections or this aooiety becomes an 
easy possibility. In contrast to .hi. . society which Is organised 
on the basis or mutual sympathy whose members deal magnan- 
imously with one another, in which every one lends generous 
distance to. fauow citizen in need, in which ,hc affluent 
extend ewmderate help or at least honest cooperation to the 
deprived sections in such « society mutual love, consider- 
ate and regard will develop and flourish, the components 
of thia society will adhere ' to and suptus.t one another 
internal strife and conflict will never find headway in this 
society and owing to mutual cooperation and help, this 
society win develop at a ranch faster pace aa compared to 
toe former society. 

Let us look at the economic side of the same question. 
Fronwbo point of view of ecoaomics, there are two tyoea of 
rtterest-bcanng debt. One. the loan which hard up and needy 


persons raise to meet private requirements. Second, the loan 
which ao entrepreneur raises, lo invest \u business, industry 
tad agriculture. In regard to the first type of debt, the whole 
world knows thai interest on it is charged in a manner which 
has the most ruinous consequences. There is hardly a country 
in the world in which money-landers and bank9 ore not tucking 
the blood of poor labioriog classes, farmers and low.income 
groups through this type of loan. Interest makes it very 
difficult, sometimes impossible, for these people to discharge 
the first debt without raising a second loan and then a third lo 
pay off the second aod so on. Even when they have paid 
interest equal to doufre and treble of the principal amount, 
their liability for the principal amount remains intact. A 
major portion of the earoiog of a working man is expropri- 
ated by the money-leader, leaving the poor man with hardly 
enough money to Teed himself ind his family. Consequently the 
worker gradually loses all interest in his vocation. This it 
natural because when a inapr part or their income is snatched 
away Hy someone else, how can they function whole-heartedly. 
Again constant anxiety and mtJtal strain so enfeeble* the 
people entrapped in the net of interest-bearing loans, and 
poverty makes it so impo«»ible for Lbem to procure adequate 
food and medical relief thai they caunotkeep in good health. 

Another consequence of the interest-bearing loan is that 
a tiny minority fattens on the blood of millions, while the 
Gross National Product continues to fajl extremely short of 
its full potential. In the long run even the fat blood sucker* 
cannot escape harm, for their covetoutness causes such misery 
to poor people that a storm of anger and hatred against the 
wealthy class brews and develops in the hearts of the poor 
people, and bursts like a volcano at the first opportunity of a 
revolutionary upheaval, and sweeps away the life, riches and 
honour of the capitalist class. 

As for the second type of debt which is raised for invest- 
ment in business, the charging of a fixed rate of Interest on 
it entails conntlcss disadvantages. The most conspicuous 
among them are the following ; 

'4 *r 


1. Capital investment is withheld from those enterprise* 
which canoot yield profit equal to the prevailing rate 
of interest, however necessary and beneficial those 
project* may be for the country and the nation. The 
flow of aH financial resources io the country turns in 
the direction of those enterprises which carry iho 
prospect of a profit margin equal to or more than the 
current rate of interest, even though such enterprises 
may bav e Utile or no social value. 

2. Noue of the enierplscs, whether commercial, industriaf 
or agricultural for which interest bearing loans are 
rcadjly available, can guarantee ihat under any cir- 
cumstances i is profit margin shall remain equal to or 
me above a certain fixed rate of interest sny 5 or 6 or 
10% and will never fall below this rate. 

Let alone providing this guarantee, no business venture 
can furnish even this security that it will for ever yield 
profit and no lost. 

Hence capital investment in a business which provide* 
security of a fixed rate of profit can never be devoid 
of the possibility of loss and risk;. 

3. Since (be financier does not share in profit and loss 
but advances money on the security of a fixed rate of 
profit only, so he has no stake in the progress or 
decline of a business. With extreme selfishness, he 
keeps his gaze fixed on his own profit, and on the 
slightest apprehension of a downward trend in the 
market, pulls out his capita). Thus sometimes due to 
his selfish apprehensions the market is actually gripped 
by depression and at other times when depression has 
been brought about by other causes, the selfishness of 
the financier aggravates it to disastrous proportions, 

So obvious are these three disadvantages of Interest 
that anyone who has the slightest acquaintance 
with th- science of economics cannot deny them. This 
being so, one is forced Co admit that, in accordance 



with the natural law established by God. interest 
actually diminishes economic wealth and does not 

Now take a look at the economic effects and conacqu- 

ir the affluent members of the society spend freely 
according to their means on buying the needful com- 
modities for themselves 1 and their families and distri- 
bute their surplus wealth among the poor so that they 
too may buy the commoditirs they need, and if they 
still hive a sum left advance it as Interest free Joan to 
businesi entrepreneurs, or invest it in business on a 
partnership basis, or deposit it with the Government so 
that it may spend it on public welfare, then, as every 
mao cm realise with little reflection, the Business, 
Industrial and Agricultural Sector in this Society will 
receive tremendous boost. The level of general pros- 
perity will progressively rise and the gross product 
it) Th ; s society fti.I be greater by fax than the Gross 
Product in an intertst-ridden society. 
Finally, another aspect should also be kept in view. 
It is clear that only he can lend money on interest who 
has rrccived a greater Share of the economic wealth of 
the society than his need warranted. From the point ■ 
of view of Quran receiving a greater share of wealth 
than o"z need* is in reality a blessing from God and the 
correct mode of thanks-giving is that just as Allah has 
ihoacTcd H15 blessings upon him so he should also 
confer favours upon other men i 




We must discuss now whether after abolishing Interest, a 
I. -n* of tkt Quran. Vol J, pp. 195-205 by S. Abu) A'ala 


financial system consistent wich the needs of s developing 
society sad State can be esteblished. p ^ 

Some MlscoKcwltoas 

Bsfowweanternpomdiwussioaaf tbe above question 
essentia to clarify curtain misconception, whlcb^onfute 
the th-onfbt or tbe people eot only J D hut in e 

misconception is tbe one winch bas given rise to tbe above 
question. Reason tells ut that Sood it so evil. Allah sod His 
Jj^J ■* Qa hi »> «op have proicribed alt forms of 

la view of this the queries "Cao we do without it?" and 
Pr~«i«b|, r .mo,, to ..king M Js any error inevitable 
.n the and "II there ,ome g<»d which ii 
Impracticable?" This Is tantamount, to putlog a vote of no 
confidence la Netnre and it. system. This means thmt we 
breathe la inch e wicked unlverssl sjntem in which some of 
our read oaeds are linked ap with errort and evil conduct and 
the door, of certain virteei been deliberately doted 
upon as. A. if. this were not enough, the lonic.l conclusion 
of this thought, would be that Nature itself is so crocked thsi 
whatever is wrong by ber own laws h set us I Jy useful, necemary 
end practicible in ber system ; and whatever f 3 ,j Rbt k v h ' 
laws is actually useless, sad Impracticable. 

Do par reason, sciences and historical experiences renllu 
juslirt this suspicion against Nature ? " y 

rs It true that Nature is the all, of evil sad enemy of 
good 7 

ir the answer is yei, then we should wind up all debatei 
about right and wrong of thing, and frankly MgigB thit , if 
for after this there b no gleam of hope left for u, in this world! 
But If our own nature sod the nature of tbe univer.e do not 
deserve this suspicion, then we ahould give up that mental out 
look «ays-"Sucb and such thing is no doubt evil, but It 
* "cesanry evil," or "Such and suck thing is no doubt good 
but It is impracticable." The fact is that human affairs follow 


whatever mode gains currency its the world, and i( begins to 
look difficult to replace the current mode with another. This 
is so with every way of life whether il is right or wrong. The 
difficulty lies in changing it- The real cause of complacency 
is the established custom. The people with superficial minds 
are easily Led to believe that the wrong mode which has eotren. 
cbed itself is the only practicable way of life and there is no 
feasible alternative to it. 

The second misconception regarding this mailer is that 
the people do not grasp the real cause which makes the 
change-over difficult and blindly accuse the doctrine of change 
as impracticable. Vou will grossly misjudge the possibilities 
of human endeavour, if you consider any alternative to the 
prevailing system as impracticable. In a world where such 
extreme revolutionary doctrines as the complete liquidation of 
private property and the establishment of collective ownership 
of the entire wealth have been translated into practice, it it 
preposterous to aver that such balanced proposals as the 
abolition of Interest and the establishment of the system of 
Zakat are Utopian. 

This, however, is true that to uproot the prevailing system 
and reconstruct life on a different pattern is not the work of 
every Tom, Dick and Harry. This task can be performed by 
those people only who hold two qualifications. One, complete 

renunciation of the old system of life and genuine belief in the 
creed which seeks to change the order or life Second, posses- 
sion of an Ijtihadi genius (i.e. the capacity to form enligh- 
tened judgment) rather than a Taqlidi (thoughtless adherence) 


They should not merely possess that ordinary kind of intel- 
ligence which is required for directing the old system in the 
same way as its pioneers did, but that superior degree of in- 
telligence also which is needed for abandoning the. beaten 
ttack and striking out new paths- Whoso possesses these two 
qualifications can put into effect the programme of even such 
extreme revolutionary doctrrnes as Communism, Nazism, ana* 



Fascism. Those who lack these qualifications cannot even 
bring about [be most balanced change* proposed by Islam. 

There is yet another small misconception regardlog this 
matter. As a sequel to constructive criticism and proposals of 
reform when a practical order of life is demanded the people 
worn to thiol that action is confined to paper work only, al- 
though the field of action doci not lie on paper, bat on the 

All that really needs to be done on paper is Co explain 
argument and illustration the errors and evils of the prevailing 
iyitem and prove the rationality or the programme of reform. 
After (his : nothing more can be done about practical problems 
save presenting bsfore the- people a general idea of how to 
obliterate the wrong practices of the old order and put m 
force the new order. 

As for the question : Wbat will be the detailed picture of 
tfait wrecking and reccastructioa. through what phasei will this 
process pass and how will the problems arising in each phase 

be solved no one can predict the« problems nor cat) supply 

an answer to them. If you are convinced (hat the present 
system is wrong add that the scheme of reform is right, then 
you should act and put la position of authority such people as 
possess faith sod power of enlightened judgment. Then any 
problem that arises in the process of action will be resolved at 
its proper stage. How can that which has to be seen, and done 
in the field be shown on paper? After this explanatory note I 
need hardly say that I will not present a detailed scheme of 
interest free financing in this chapter. I will Only give a 
general idea of practical steps which may be taken to expel 
interest from our financial system, and also how to solve those 
principal problems which apparently crop up in the mind when- 
ever the expulsion of Interest is mooted. 

First Step Towards Reform 

Ad infinite number of evils in the economic and financial 
system have crept fn because interest has been sanctified by 
Law. Obviously when the door to charge Interest opco, why 


should I* man extend a charitable loan to at* neighbour ? And 
why should be enter into a reguUr partnership in profit or 
loMwiih a busmen? Why should he make selfless con- 
tributions for the completion of National projects? 

And why should not he nand-over his accumulated capital 
to - the banker and feel secure in anticipation of a fi™ d p , ofit . 
After allowing free rem to the evil tendencies of human nature 
you cannot expect that preaching, counselling and morat 
appeals will succeed in nipping those tendencies and countering 
their disadvantages. Again the matter does not end with 
giving free scope to a D evil tendency. The Law supports, 
ibis tendency and the Government itself is nurturing aD d 
operating this evil through the current Financial System. 
Under .his circumstance how is it possible to counter the evils 
of Interest by parti.l amendments and fringe reform The only 
preliminary to luppreasiDgtfieevili 0 f Interest is to expel the 
Interest. Those who imagine that first the blueprints of an 
interest free Financial System should be prepared, and then 
Interest will automatically disappear or wm be banned by law 
are putting the cart before the horse. As long as Interest haa the 
sanction or law, the courts validate and enforce contract* in- 
voiving interest and the door » open for the bankers to mop up 
capital on the bait of interest sad then lend it out on intcreat, 
so long ,t IS impossible to create and develop an interest free 
Financial System. Hence if the ban on Interest is conditional 
upon the development of a system which can replace the current 
usurious system, you can be sure that the time for banning the 
lorereit will not come till Doomsday. Whenever the work of 
donating the sood has to be done, the first preliminary will 
j«viubly be the legal suppression of Interest. Then an interest 
free Financial System will be automatically born, and necessity is the mother of inveotioD. will iwtlf pave ways for its 
growth and expansion on all sides- The roots of the evil human 
instincts wtuch me to Interest are so deep-seated and their 
orges so powerful that half measures and lukewarm devices 
cannot wipe out this scourge from any human society. For 

interest jo$ 

tins purpose it is necessary to put into effect all those measured 
which Islam suggests and (he problem should be tackled with 
that zeal which Islam demands. Islam dues not stop at mere 
mora* condemnation of usurious businssx, but on the one band 
-rouses aversion io it by proscribing it from the religious pomt 
-f view and on the other wherever Islam holds political aWa y 
and governmental power, it impose* a legal ban oa Interest, 
declares all usurious contract* as invalid, and proclaims the 
rseelpt and payment of Interest, writing and witnessing a deed 
of agreement concerning Interest as a penal offence liable to 
police action, and wherever m'ld penalties fail to curb this 
business Islam inflicts upon offenders (be sentence of death and 
confiscation of property. 

Thirdly, by declaring, Zafcat as an obligatory duty a D d a regular system of Zakat collection and distri- 
bution, IsHm initiates a new financial system in the ioci«iy 
Besides enforcing all these measures, Islam reforms ibe 
character of the Muslim people by training, propagation and 
preaching so that all those qualities and urges in burnt* 
nature which incline a person to uiurious business an 
suppressed and replaced by those opposite qualities and 
proprnsuies which generate a spirit of sympathy and generoua 
cooperation in human society. 
Consequences of Ibe Abolition of Interest 

Anyone earnestly wishiog to curb Inferest will have to go 
through the process outlined above. The legal prescription of 
Interest coupled with ibe establishment of a social institution 
for the collection and distribution of Zakat, will have three 
consequences from financial point of view:- 

(1) The first and the most important consequence would 
be that the present socially explosive mode of capital 
formation will be replaced by a correct and whole- 
some mode. The present mode* of capital formation ia 
that nsing artificial devices over sue ml system augments 
the natural human propensity towards stinginess and 
acquisitiveness to aa exaggerated degree. Arousing 
both fear and greed, our social system persuades an 


individual 10 Spend ihe least part of his income and 
save tbe maximum. 2t warns the individual " save, 
for there is none in tbe Society who will rescue you 
from hardship". It excites bis greedy instinct by pro- 
misicg ; 

"Save and you shall be rewarded with Interest." 

Under the impact of this double stimulus, the sections 
of society whose earning* exceed their need? even to (he 
slightest degree resolve to curtail (heir spending and 
increase their savings. Io consequence the coneumption 
of tratle goods declines below the anticipated level and 
in proportion in the fall in incomes, the chances of 
developing trade and industry diminish, and tbe oppor- 
tunities of capital formation become even more scarce. 
Thus the increase in the capital holdings of a few in- 
dividuals causes a depression in the collective economy. 
An individual enhances his accumulated wealth in a 
way that readers thousands of individuals incapable or 
earning, anything, let alone saving. Is contrast to this 
when Interest is banned and by establishing tbe institu- 
tion of Zakat the State guarantees relief to every 
citizen at the hour of his need, the unnatural carries 
and incitements to ttingiress and hoarding of wealth 
will vanish. The affluent citizens will Apend freely and 
pass on enough purchasing power to the poor citizens 
also to meet their needs. This will promote trade and 
industry, which »ill open up mere employment oppor* 
(unities, and this will mean mure incomes. In this 
envirnnment the profits of trade and industry itself 
will rise to an extent where these hectors will no longer 
be dependent upon as much external financing as they 
are now. Again whatever their need for external 

floaocing, It will be met with greater facility than if 
available now, for siring will not entirely cease, as 

some people imagioe. Actually some people will con- 
tinue to save due to their natural propensity io this 

tMTttfat ^ 

«ave became of «han«d i« 0 m« a„d ltc prevakoc * 

rLlt „r , Pr05P " ily - ™* " vin * wi » «•» "e the 
result or «,»!„„,, appr^ioo or «r«d bu, will 

afl^T E ' ° f " CCOB ° m " ia 

«,ih A ^ 5PCnd "'* ' ree, > oa » wf "' head, PIC . 

„'" bu> """"< 1 " "-diJy available on e „ y 

aepo SIts> ,bvar ro ,a n ce of capital will evapo,.,. l, 
-.11 be „ g „ l0 rush ial0 , ay „„ P el ^' 

(3) The third con.equtnce wjjl be that f^„. - , 

uad ei ,he pi „ tnI S)S[eia capilll js 8upj ;;. D « 



for the most part in the form of loan whether an 
individual or ao organization wishes to raise money 
for a productive or aon-prod jctive enterprise, or for a 
temporary need or long-term project in all cases 
capital can be had only on ooe condition ; that it 
Should be taken as a lean on fixed rate of interest. 
When interest is banned, credit will be reserved for non- 
productive purposes or temporary business needs and it shall 
be managed under the rulp$ of charitable loan. 

As for the other purposes, whether they relate to Industry 
or Trade or the profitable schemes prepared by Government or 
Public bodies-for all these capital shall be provided not as 
loan but as an investment on profit-sharing basis. 

We shall briefly discugs the function of both these lectors. 
Forms of Credit in an Interest Free Financial System 

Let us take the credit sector first, for by far the greatest 
apprehension from which people suffer to-day is that with the 
proscription of Interest, the supply of credit will stop altogether. 
So «e shall first of all show that, with the removal of this evil 
hinderance, not only will the supply of credit not atop, but will 
he attended with greater facility and will assume a much better 

Credit for Pri*aie Needs 

Under the present system, there is only one form of obtain- 
ing credit I.e. a poor man should borrow on interest from a 
money-lender and a man of property from the Bank. In both 
cases every applicant can take any amount of loan for any 
purpose including indulgence in sin, extravagant spending or 
genuine need, provided that he Can otfer security for the 
safe return of Principal and interest- On the contrary an 
applicant who cannot offor this security will not secure a 
loan of single paisa, even if he wants it to buy a shroud 
for the corpse lying at home. Again under the prevailing 
system, the prodigality of a wealthy scion and the hardship 
of a poor man, botb provide a golden chance for the money* 
lender to make money. And this selfishness is coupled with 

callousness of such extreme degree that no concession is allowed 
to the debtor io the payment of either l D i cre5 t 0 r Principal. No 
one baa the subtest humanity to enquire into the circiimt- 
lancrs of the wretched debtor from whom they demand the 
return of Prim; ip. I wjtb lateral. These then are the 'facilities' 
which the current system provide! for securing ioans for 
private need*. 

Now see how the interest free credit system of Islam 
operates in a similar Lontext. 

Firstly, in this system, the supply of credit for extravagant 
spending and ioJu]£eoce :a sin will stop, for no one will be led 
by the greed for inicrest to advance a loin for wasteful spending. 
Thus the entire business of credit will be limited to reasonable 
needs only and unly such amounts will be advanced or taken 
as clearly appear to be reasonable in tne individual circumst- 
ance* of each case. 

Again since in this system it would be illegitimate for the 
creditor to exact «y kind of advantage from the debtor so the 
repayment of loans wj/l become easy. 

Debtorainthelow-iocome grant will repay their debt in 
caay instalments and w,n won be free of the burden. 

Where a bouse or any other property has been mortgaged, 
its rent 01 income will be counted toward, the discharge of the 

principal rather than payment of any Interest, and in ihe debt 
will soon be recovered. 

Despite ih«e facilities, if a debt does remain unpaid, the 
Batt-ul-Mal (Public Treasury) will stand security for each debtor 
and will help him TO pay off his debt. Fuithcr. supposing the 
debtor dies insolvent, even then Bait-ul-Mal will assume the 
liability to pay his debt. For these reasons the affluent will 
not End it as hard and unpleasant to lend money to a needy 
neighbour as they do under the current system. 

Even then if anyone fails to raise a Joan in his own neigh- 
bourhood or community, the door of Bait-ul-Mal will be open 
for him. He will easily secure a loan from her. It shouid', 
however, be borne in mind that seeking loan from the Bait-ul- 



Mai la the Jast resort. Id Islam, it is the duty of every citizen 
to lend money to bis fellosr-citiien ia need and it ia the 
test of a community's social health that its members should 
personally feel aa d discharge moral obligations such as this. 

If the resident of one locality fail* to obtain credit from his 

neighbours and is constrained to seek a loan from the Batl-ul- 

Mal it is a clear symptom of the moral ill-health of that locality. 

Hence whenever in application for loan arrives, the Bait-ul- 

Mal will not only advance the loan, but will at once refer this 

case to the department of moral reformation which will 

Immediately focus its attention on the locality whose residents 

did not help a neighbour in n«ed. The report of such a case 

will create the same horror and revulsion under a morally pure 

and upright aystem a* the incidence of cholera or plague does 
in a materialistic society. 

Yet another form may be adopted in Islamic system for the 
supply of credit for personal nerds. The legal rights conceded 
to employees should include a right to secure a loan from the 
employer (Business Firms, Trading Companies etc.) under 
extraordinary need. The Government generous loans. This 
should also grant this right to its employees and advance them 
matter does not have only a moral aspect. Its economic and 
political importance is as great as moral. By supplying an 
interest free loan to your enplcveei and labourers, you will not 
only perform an act of virtue but will remove one of tbe biggest 
causes of anxiety, perplexity, misery, physical anguish and materia 
ruin among your workers. Protect them from calamities and 
anxieties ; prosperity will ln h *rease their capacity for work and 
satisfaction will immunise tbera against mischievous doctrines. 
This type of loan may not 3 how any profit in terms of accounts 
but it will be sufficiently clear to an enlightened mind that for tbe 
society as a whole and for every financier and factory owner 
individually, as well as for every economic and political institu- 
tion, its profit would be greater Lo value than interest which is 
being exacted due to foolish short sightednew under the present 
materialistic system. 


Credit tar Soilness 

Let uk consider the loans which business w often need 
to raise. At Che present time the businessmen either tale *hort- 
term loans directly from the Banks or caih Bills of Exchanse i 
In both cases the Banks charge a modest rate of interest. Such 
oan* are an md.spensable busies* need to-day. Hence when 
the businessmen bear about the proscription of Interest, their first 
anxiety is bow will they secure credit for daily business needs ? 
•Why ahculd the Bank lend us money or caib oqr Bills of 
Exchange without the incentive of Interest", they ask. 

The question, however, is that why should a Bank which 
receives interest free deposits and buiiness accounts amounting 
to hundreds of thousands of rupees, not advance interest-free 
loans and honour Bills of Exchange? 

If the Back does not voluntarily agree, it shall he bound by 
law to provide this service to the customers. This service should 
be part of the duties of a Bank. In fact, the deposit accounts 
of businessmen alone will be adequate for this purpose. But 
if need be, the Bank can alto draw apon other accounts. At 
aoy rate ji is a quite reasonable principle that he who does not 
.charge Interest should not pay it. Again it is belter from the 
point of y*w of over-all economy that businessmen abouid be 
able to interest-free loan, for recurrent needs. 

As for the question : If the Bank does not charge Interest on 
us transaction, how will it meet the cost of operation? 

The answer ,s that since the entire amount in its current 

f . "V"*"***- * -« * "I be a losing bj£* 
for the Bank to advance temporary loaas out of that amount 

for the earn from these credits will f lr „ Cecd th ; 

EST £ "•"I*'"?*-*™", supposing this is no. 
feasible , the Bank c a n justifiably charge an adequate monthly 

for ihe.atlpBlatcd period ibo l oaD i, ranald \TS^c : Bm 3>f ^fl! 0 * wai ' 1 
p vl ,« bold aaxuna. Thu is called "Shia^h.fti. 


or quarterly fee Tor these service* fro* all it* business account, 

The account-holders will End this fee leu costly than interest, 
10 they will readily accept it. 

Credit for the Non-Prodnctlre State Expense 

The third important head relate* to those Jeans which the 
Government has to raise to meet emergencies, non-productive 
national expense and for the purposes of war. Under the 
current financial system money for all these purposes is obtained 
as interest-bearing loan. But under the Islamic fiscal system it 
would be quite possible for individuals and organizations to pilo 
up voluntary donations so soon as the Government announces 
its Deed, for the proscription of Interest and establishment of the 
system of Zakat will result in such general prosperity and satis- 
faction that it will be no great burden for the people to hand 
ovef their savings to the Government. If such donations fall 
short of the Governments' need, it can ask for loans, and the 
people will advance charitable loans with ao open heart Sup* 
posing the money so collected still falls short of the expense, the 
Government can resort to the following means : 

(1) It can use the Zakat and Kbums.* 

(2) It can demand on loan certain portion of all cash 
deposits in the banks by an ordinance of State. 

This right of the Government is as valid as its right to 

enforce conscription or its right of requisition of private 

buildings, motor vehicles and other property. 

(3) Finally the Government can meet its need by printing 
additional currency notes which in fact, is just another 
form of raising loan from the citizens. But this is 
absolutely a last resort to be taken in unavoidable 
circumstances, for its evils are far too many. 

International Loans 

Let us consider International Loans now- It is quite clear 

1. JCAmtj denote! the fifth y f property wblch is given to the Sail-ut 
MfJ or Public Trcsaurv. 


that in the pre scot usurious world we cannot expect to raise 
an interest free loaa in the international market to rtuet our 
national needs. Our utmost endeavor should be to avoid 
incurring any externa] debes, al least till the lime when we 
present a mode* to the world or how a nation can extend interest 
free loans to her neighbours. 

As for advancing loan* to other nations, every enlightened 
reader who has gone through the foregoing discussion will readily 
admit that if once we g=rd up our loins and establish a pure fiscal 
system based on the suppression of Interest and organization of 
Zakat, our financial position is bound to become so Sound that 
not only will we not oeed external debts but will be able to extend 
loans to our neighbouring nations in need. The day when we 
present this model id the world, .will usher in a great political, 
cultural and moral revolution in the world. On that day it will 
become possible for interest-free transactions to take place between 
us and rest of fhe world It will also be possible for the world Co 
conclude pacts that they will deal with each other on an interest- 
free basis. And it is not beyond possibility thit we will sen a doy 
when the world opinion will unanimously turn against usury much 
the same way as the British public expressed its disgust with 
usury in Brittingwoods ca«e (194V. 

It is not merely a daydream. The truth is that even to day 

enlightened minds arc concerned at the adverse effects of interest 

bearing international knns on world politics and economy, [f 

the affluent countries forsake their present poliuy and use their 

suTplUS wealth in a sincere and considerate effort to help the 

backward countries to stand on their. own feet, the world will 
en ; oy double bonus. 

Instead of the rising tension in the field of international 
politics and culture world relations will be marked by growing 
amity and friendship. From the economic point of view it would 
be far more profiiabfc to do business wjtb a comparatively 
prosperous couutry rather than suck the life blood of a 
miserable and bankrupt country, lieonomic thinkers arc con- 
verging on this point and many have already expressed these 


ideas The only thing (bat needs to be done now is that t wise 
nation should take the initiative, suppress interest ia its own 

home and pres. forward to expel this evil from infenutiozial 

Prevision of Capital for Productive Veitoru 

Next to the financing of Joans, let us now look into (be 
financing of business in our projected system. In this connection 
as I have fainted above, (he suppression of interest will 
close the door of inves(ing money at a fixed rate- of profit' without 
labour and risk. Similarly Zakat syitem will ensure that the 
people do not hoatd money and sit tight on their coffers. 
Furthermore, under a real Islamic Government too people wilj 
no longer find it feasible to dissipate their surplus wealth in 
amoral pursuits and extravagance. So (be section of people 
who possess surplus wealth will have to adopt one of the 
following three courses : 

1. If tbey do not seek additional income they may spend 
their savings on public welfare works. It may take 
two- forms. They can either undertake welfare work 
on their own or give donations or gifts to a national 
organization. Tney can also offer their wealth with 
selfless and sincere reeling to the Islamic Government, 
which will invest it in productive schemes, social deve- 
lopment and public instruction. The last-mentioned 
bead of investment will be especially preferred, provided 
that State administration is in the hands of persons in 
whose Integrity and wisdom (he general public has ful? 
faith. In this way huge amounts of capital wiD be 
constantly available to Government and other collective 
organizations for national projects ; and works of 

progress and development, and what's more the people 
will not be burdened with taxes for the repayment of 
even principal amount, let alone interest or profit' 

2. If they do not seek additional income, but wish to pre- 
serve their surplus wealth for their own use, they should' 
deposit it in the Bank which, will not receive it as trust 


but as loan. The flank will undcrt ale to return the 
money on demand or after a fixed period. At the fame 

time toe Bank shall have the right to invest this money 
in business and earn profit on it. The Bank will not 
pay any portion of this proBt to- the depositor. The 
Bank: iball be the sole owner of this piofit. 
Imam Aba Hanifa (Allah be pleased with him) ran bis 
business largely on this Islamic principle. In view of bis 
integrity and extraordinary good-will (he people deposit- 
ed their money with him. The Imaa did not take this 
money as trust but as loan and invested it in business 
His biographers report that when his accounts were 
checked on hit death, it was found that his business 
capital included 5 crore dirhams deposited with htm by 
the people in accordance with the above-mentioned 

Islamic rule forbids thetruefoe to put the trust to per- 
sonal use, but if the article put in trust witb him as lost 
or wasted, be Is not held liable In contrast to this iF the 
same article is given to him as loan, he has the right to 
use it and earn profit on it. He is, however bound to 
repay it at the agreed time The Banks can follow the 
same scheme to-day. 

3. And if they Intend to earn profit on their saving, they 
will have just one option it. to invest their capital 
through Government on the basis of proportional part- 
nership in profit and loss. 

If they wish to invest directly, they will have to settle 
the terms of partnership themselves, and these terms most 
by law fix the ratio of their share in profit and losa. 
Partnership in joint stock companies would take the 
form of simple purchase of shares. Bonds, Debentures, 
and other similar forms of partnership, which yield 
a fixed amount of Income for the buyer from the com- 
pany will not exist at all. 

Jf they wish to invest through Government, they will become 



partners in any profitable scheme launched by the Government. 
For instance, tf the Government pre paree a project to build a 
Hydraulic project it will announce the scheme and invite public 
participation in It. Individual*, organization* or banks which 
invest in the scheme will become partners with the Government 
and will receive share of the profits from the project according 
to au agreed ratio. If the project runs into loss, they wilt share 
the loss with the government according to the agreed ratio. The 
Government iball also have the option to buy public shares gradu- 
ally by phases, till In a period of forty to fifty years the whole 

project comes under the State ownership. But as in the current 
system, so in the Islamic system also the most practicable and 
useful course for the people would be to invest through Banks, 
Hence I shall explain this course in some detail so chat the people 
may get a clear picture of tbe Banking buiiness without interest 
and how ibe people wishing to earn profit would be able to 

benefit from it. 

Islamic Form of Banking 

The discourse of Banking In my book The Interest makes it 
plain that the Banking business is, by no means, wrong or 
unlawful. Actually Banking is one of those numerous institutions 
reared by modern civilization, which are. important and useful, 
but have been corrupted by the admixture of an evil element. 
In the first place, tbe Bank performs such lawful services which 
are both useful and indispensable for a civilized life and com- 
merce in modern times, for instance, cash transfer and payment 
from one- place to another, facility of International business* 
transactions, Lockers for valuables, letters of. credit, traveller 
cheques, demand draft, arrange sale of company shares and many 
Agency Services which relieve a busy man of many a burden 

against nominal commission These facilities must however 
continue and the establishment of a permanent institution for tbe 
provision of these facilities is" quite essential. 

Again It is extremely beoeflcral and necessary under present 
conditions for the Business, Industry, Agriculture and other 
departments of culture and economy thai ibe scattered surplus 



wealth of the society should be pooled in a Central Reservoir from 
where it may be smoothly channelled lo all sectors of life, whenever 
and wherever the need arises. Besides this scheme la very convenient 
for the common man with some money saving as St can spare him 
the trouble of searching out profitable opportunities of invest 
meat He cap deposit his money in a Central Reservoir, which 
would invest it in productive projects and diitribute the profit 
anions its account holders. The administrators and workers 
of a bank, by virtue of being constantly engaged in the rr inage- 
raent of Finance acquire ao expertise and wisdom in this field, 
which is lacking in businessmen, industrialists and other pro- 
fessionals in the economic sector. This wisdom and expertise is 
by itself a very vaUable commodity and can prove very benefi- 
cial provided that it does not become the tool of selfish money 
hoarders but is used to encourage the businessman. But it is 
Interest which- has inverted all these virtues and benefits 
of Banking v ' c « awl disadvantages for the whole society. 

Along with this another source of evil has crept into Banking i a. 
the capital which the bait of Interest attracts into banks becomes 
virtually the wealth of a few «clfiih capiiaJLts who use U in mit 
extremely anti-social manner. With the elimination or these 
two wrongs, the Banking business will become pure an., "tt more 
profitable for the society than at present. Rather it micht prove 
more beneficial financially than the prevalent banking system far 
even the bankers. 

Those who fear that the elimination of Interest will stop the 
Sow or money into Banks are wrong. They think that without the 
incentive of Interest, the people wilt slop depositing their surplus 
money in the Banks. Well this ii not true. Instead of Interest, 
there will be the incentive of profit. Sio^c the rate of profit would 
be uncertain and unlimited, th= baiacd of the profit rate failing 
below the interest rate would be equalled by aa good a chance 
of earning a proCnate which far exceeds the interest-rate. The 
Banks will continue to perform all those duties for which the 
people comer to them. Hence it is certain that the flow of 
capital will continue into the banks undeterred even after the 



abolition of Interest u usual-nay since the supression of Interest 
wW give an impetus to business, increase the chances of employ- 
meat and of incomes, hence the quantum of deposits in the banks 
would increase. The banks will not be able to invest the money 
deposited in current or savings accounts in profitable projects as 
at present. Hence these amounts will Jargely be used for two major 
purposes : one, Tor dally cash dealing ; second, for extending 
short-term loans to businessmen and encashing Bills of Exchange 
without charging interest. As for the long-term and fixed 
deposits it will necessarily fall into two categories, one, whose 
owners deposit it for safe-keeping only. T&e Banks will invest 
this money as loan in buiinejs as explained above. 

Secondly, the money whose owners wish to invest it in busi- 
through the Bank. 

Instead of keeping this money in trust, each bank will 
execute a deed of partnership with tbe depositors. The Bank 
will then invest this capita! aJong with their other deposits in 
business, Industrial and Agricultural projects, as well as in profi- 
table schemes launched In the public sector and stare enterprises 
This on the whole will entaij two stupendous advan tages. 
Firstly, the interest of the Bankers will become one with the 
interest of tbe business, and financial support to business 
will always be available mccordJng to need. Thus tbe causes 
which bring about periodic economic depression in the present- 
day interest-ridden world will almost disappear. 

Secondly, (he financial expertise of the bankers and the 
business and industrial acumen of the entrepreneur, which 
appear at loggerheads to day, will coalesce and cooperate with 
% each other and this will be beneficial for all sides. After 
deducting the cost of operatic^ the Banks will distribute the 
profits earned through these sources among the share-holders and 
the account-holder? according to a fixed ratio. The only difference 
will be that, under the present set-up, tbe dividends go to the 
shareholder! of the Bank and the accounl-holders get interest 
only while after the abolition of Interest, both wfH share in 
tte dividend. Now tne account-holders get a fixed rate of 



interest, but under the new system no Bxed rate will operate. 
The profits big of small, will be distributed lo proportion to 
investment. The risk of low aid ineorvency, then, will be no 
mote or less than it * now. At present risk of low and pro- 
spects of unlimited profits both are marred for the share-boldete 
of the flank. Under the new sot-op they will be shared by toe 
accouot-hoWeri 3U0. As for apprehension that the capital 
which is drawn into the Bank by the incentive of proat becomes 
virtually the property and tool of a f ew Bankers, we am remove 
it by adopting the following scheme. 

The Bsii-ul-Mal nr State Bank should take in hand all 
functions connected with Central Banking. State control and 
discipline should be enforced on the private Banks in such a way 
as to prevent the Batik era from taking ondue advantage of their 
monetary strength- Having gone through this brief sketch of an 
interest-free financial system, li there any room for the doubt 
that the elimination of Interest is not feasible? 



QvfStioa. Id the present cr* whea oo country can develop in 
isolation from international community, will the Islamic Govern- 
ment totally ban the flow of all economic, military or technical 
aid from foreign countries tied with certain rate of interest and 
the raiting of interest bearing loans from the World Bank ? 

Again bow can the tremendous gap between advanced coun- 
tries of the Weil aod the Middle East especial,y the Muslim 
countries in respect of material, industrial, agricultural and 
scientific progress be tilled ? 

Or how can the gulf between the haves and have-nots in 
this atomic age be bridged? 

Fuitber, will the Banking and Insurance Sector within (be 
country be liquidated 1 

What system can be devised by ljtihad to provide some way 
out of Interest. Commercial standing {Pa^ri), Profit, Broker's 
Commission jo sJe purchase transactions and Good-will? 

Can the Islamic countries negotiate any loans among 
themselves on the basis of Interest or profit or aoy >on of gain. 

Answer. Never in history hat the Islamic Government 
adopted a policy of isolation from non-Muslim countries, nor 
will it to-day. But borrowing does not mean importuning loans 
on their terms. This sort of relationship with advanced countries 
has been adopted only by the inert regimes of today. Whenever 
a real Islamic Government is established in a country, it will 
strive for the moral uplift of its citizens before working for 
their material progress. Moral improvement implies kbui (be 
rulers, the administrative services and the common citizens 
should imbibe the virtues of faith and honesty. keep duty above 
their rights a Q d stake their life, property, time. labour, 
energies, everything for the achievement of a lofty gtfkt. 
Further* relationship of mutual trust and confidence should 
subsist between the people and their rulers, and the people 
shoul d honestly feel that th e Government is actually workiog 
I. Adop:*d from TarJuwrf'-QtrM, November J ML 



for their well-being. Once such a polity is established, there 
would be no need to borrow money on iat crest from others. 

The people will pay the taxes voluntarily and without fail 
aad the revenue* will be spent entirely ufl national develop- 
ment. The process of collection sod spending nf taxes will be 
free from malpractices. Stilt If the Government needs m raise 
a loan, the nation will meet a major part of tht requirements by 
way of voluntary contribution!, a Stable portion in the form 
of intere&l-free loans and a part of it on profu-shariog basis. 
My aftse^mcnt is that if an experiment of Islamic principles 
if made in Pakistan it will scan be in a portion lo offer loans to 
others instead of begging others for loans. 

Supposing we do face an indispensable need tu raise tin 
intercat-bearing loan from abroad, ihat is, wbcfl our need ii 

pressing and the capital resources at home uaouot be mobilised, 
we can then borrow from foreign nations oo wteran. Hut even 
then there would be oo justification for continuing usurious 
dealings at home. 

It is feasible to ban Interest inside the country and the 
entire financial System can operate without Interest. I have 
already established in ray work oo the Interest that the banking 
system can run on profit-sharing basis rather loan Interest, 

Similarly, the Insurance vystem can be so amended as to 
obtain all the benefits of Insurance without resorting 10 
uo-hlemic methods. 

Brokerage, Profit, Pugri (Benefit of Commercial Standing) 
Commission or Qood-wjn, aU have » separate position in 
Sharlah. When the Islamic St <u- is established, their respective 
positions will be reviewed and either the status quo will be 
maintained or necessary amendments will be introduced. Such 
a work will have to be done by a Commission of Scholars' of 
Sbariab and Economic Experts. 

The Nature of Zakat 
and Its Rules 1 

Next to SaJat, Lhc principal pillar of Islam is Zakat. 
Since fasting is commonly mentioned next to SalSt^Jn toe order 
of worships, ao the people generally consider Farting as (he 
■econd most important article of faith in Islam; after SalSt. 
Yet the Holy Quran reveals to . us that next to Salat, Islam 
assigns the second most important poiitioa to Zakat. These 
Me the two principal pilfars upon which the edifice of Islam 
has been raised. Islam canaoc stand upright if these pillars 

The of Zakat 

Zakat denotes purity and cleanliness. The aUocation of a 
portion of one'i wealth for the needy and the poor has b«n 
termed as Zakat for the precise reason that this purifies one"s 
wealth as well as -one's soul. The person whom Allah has given 
wealth and be doe* not pay out of it the right of Allah's people, 
his wealth is impure and with it his soul is unclean too. for bit 
soul is filled with ingratitude. 

He Is so stingy, so selfish, 10 money .minded that his heart 
aches at discharging bis obligation to Allah Who favoured him 
with wealth more than his real need. Can this man be expected 
to perform any virtuous act in the way of Allah? Will he offer 
any sacrifice for the sake of his religion and faith ? 

This man's soul is unclean and bis wealth which he accumu- 
lates in this way is impure. 

Preccdaat of Prophets (peace be on them) ; 

. S aying of Prayer s (Sal2t) and payment of Zakat has been 

i. Adapted from cU* iKbutfea ~~ 


THE NAlUfcZ 0* ZAKKt AMD tlS MJL1S 217 

invariably enjoined upon the followers 0 f Bit (be Prophet* 
ipeace be on them) since ancient times, and the religion of 
Islam has never been devoid of these two tenets darn* the tenure 
of any former Prophet fpeace be on him). Ate waftaS^ " 
HadTBt Ibrahim (peace be on him) and the Prophets descending 
from him, the Holy Quran observes : 

"Aod We endowed them with leadership who guided other, 
by our command, end We alio enjoined them by 
Revelation to do righteoos deeds and establish Salat and 
pay the Zakot and (bey were worshippeti of Us alone." 

(AI-Aobia : 73) 

in reference to Prophet Ismail (pesce be on him), it ii 

"He enjoined his people to offer the Saldt and give the Zakat 
and His Lord was wll-pleased with him." (Mary • 55) 

Uadret Musa (peace be oa him) offered hia prayer on behalf 
of bis people : "Lord, bestow upon u> the good™ of this 
World and of the next " Do yoo know what Allah observed in 
reply ? Allah answered ; 

M I smite with My Punishment whom I will, and My mercy 
embracctb everything therefore I shall ordain it for those who 
refrain from disodedknee, pay Zakat and believe lo Our 

^ Ut T;» * . (Al-Araf ; 156) 

Orders of Salat and Zakat ware simultaneously issued to 
Hadrat Isa(peacc be on him) aUo who was the last Prophet preced- 
ing Hadrat Muhammad fjeace and blessings of Allah be on Him). 
"And (Allah) bath made me blessed where-w-ever I may 
be, and hath enjoined upon me Salat and Zakat so long 
as I remain alive." iMary : Ji) 

This sho«, that from the very beginning the religion of 
Islam io the tenure of each Prophet has been raised on these two 
main pillars, and never has any God-fearing people been exem- 
pted from these two duties. Now see how these two duties have 
been juxtaposed in the Shariah of the Holy Prophet (peace and 
££^*^ ab be on him). The opening verses of the Holy . 


MEic**cn:5c ipoof blah 

"This is the scripture whereof there is no doubt, a guidance 
unto those who are God fearing. 

Who believe in the unseen, and establish Salfit, and, spend 
of that We have bestowed upon them." (Al-Baqarah : 2-3) 
Again it is affirmed : 

"Such people are oo the right wiy from their Lord and such 
are truly successful." 

In oiher words, the people who are devoid of faith and do 
not observe Salat or pay Zakat are neither on the right way nor 
can they be truly successful. 

Continuing with our study of Sura Baqarah, we find another 
injunction a few pages ahead : 

"Establish Salsa, pay Zakai and bow before me with those 

who bow (down) i.e. in congregation." 

In Sura Taubah Allah orders the Muslims to wage war 
against the infidel* and the polytheists and these injunctions 
continue in several Ruku's. In this context, it is observed : 

"But If' they repent and establish Salat and pay ZaJcat 

then are they your brethren in religion- (Taubah ; 1 1) 

That is, mere renunciation of infidelity and polytheism and 
affirmation of faith is not enough ; the proof of genuine renunci- 
ation of infidelity and polytheism and testification of faith ties in 
the practice of Salat and payment of Zakat. Hence if they prove 
their declaration of faith by deed, they are your brothers in faith. 

otherwise do not take them as your brothers, nor cease fighting 
against them. 



lie Holy Quran frequently refers to Zakat and Sodaqat 
(Charities) by the words -«1 <±*~J JUJ> which meant "to 
spend in the way of Allah." In some places it has also been 
observed that whatever one spends in the way of Allah i* a 
**— ■ <S? charitable loan to Allah. In other words you give 
a loan to Allah gad Allah becomes your debtor. In several 
places it has also been affirmed [hat Allah ow« compensation 
to you for whatever you give in the name of AHah, and He will 
not jut return what you donate, but will give even more. Ponder 
over thij point. - 

Is the Lord of (be Earth and the Heavens (may He forgive us) 
dependent upon you ? Does that Holy Being need to crave a loan 
from you ? Doei that king of kings, the Lord of infinite treasure*, 
sohcit anything from you for His own Self ? Allah forbid, 
AJUb forbid.. It is on Hi. Bounty that you subiiit. It Is His 
provisions that you eai. I he possesion* of each on« of you 
a« His Gift, everyone among you, rrora a pauper to * 
millionaire, j, dependent upon Hit Favour while He needs the 
favour of none. What need has H« to Seek roan from you and 
beg from you for His own Self ? 

In fact it is yet another aspect of Hi. Benevolent Majesty 
tbat He asks you to spend for your own good, your own welfare, 
your own sake and aays that this spending* is in My way, is 
a loan In Me, I owe you compensation for it and am obliged to 
you. Help the poor and needy members of your nation and 
since they have no means to return your favour, I will compen- 
8 ate you on their behalf. Give a*simnce to poor relations. 
Not they, but 1 shall be obliged to you for this act. I will give 
you a compensation for this favour. Whatever assistance you lend 
to the orphans, widows, the disabled the wayfarers and the 
afflicted people in your society, put it in My account. Your 
claim lies not on them but on Me and I will pay it. 

Extend loans to your distressed brethren and charge no 
interest, nor ha tats them. If they cannot- repay, do not move 
th** Court to imprison them or issue a warrant of attacbinent.ef 



their household effects. Do not render their families .boneless. 
Not they, but I owe you the debt. If they return the principal, 
X will pay the interest oo their behalf, but if tbey canhot repay 
even the principal, I shall return to yon both the principal and 
the interest. So although all that you spend on social welfare, 
for the good and improvement of your own fellow beings, 
will be to your own advantage, yet I shall acknowledge yoar 
favour and I shall return your debt in toto plus a dividend. 

As you know cruelty and ignorance are ingrained in human 
nature. Man is short-sighted. His viston la not broad. He is 
small. He is seldom swayed by lofty and sublime ideals. 
He is selfish, and cannot even hold a broad conception of 
hit own interest. Mania impetuous too. J** -dUVt ^ 
He wants quick result and speedy profit in every enterprise. 
Notbiog but instant and tangible result and proflt appeals to h : m. 
Hil vision does not extend to long term results, and as for the 
profit! on a larger scaie. the profits which accrue over a longer 
pciiod, be perceives them serdom or does not at all. Thi $ weakness 
ia natural to man. Due to this weakness, he looks to bis own 
Interest in everything, an interest which is small in scale, quick 
and tangible, He declares himself as the sole owner of what 
be baa earned or inherited and does not like any body to 
share It He believes that this fortune has no other use than to 
meet his own Deeds, according to his own wish and to buy him 
ease and pleasure, or to be expended on a scheme which is likely 
to yield quick and tangible dividend. He spends to increase 
bis wealth or augment his comfort or at least to gain publicity, 
reputation, prestige, honour, position, authority and fame. 
Why should h* part with his wealth, if he sees no promise of any 
of these coveted ends ? Why should be care for the orphan in 
the neighbourhood who is starving to death or loafing about 7 
The orphan had a right on bis parents, who should have provided 
for him in the form of Insurance or something. What if a 
widow in his community is eking out a miserable life 7 Her 
deceased husband should have done something to secure her 
future. What is it to him if a way-farer is wandering about help- 


*** l y ? Why did the fool not provide himself with sufficient 
means before starting on the journey ? 

Let the poor and afficted fellow endure hi* bard existence 
Allah gave him the same two hands and feet as to me. He should 
fend for himself. Why should I help him 7 Yes, but I could 
feed aim money on interest, of course, for money is not useless 
I could boHd a house wich it. or buy a motorcar, or invest it in 
a profitable concern. This man will also derive some benefit 
from it. Why shouldn't I, the owner of the money, receive a 
share or ibis bene Of ? This selfish frame of mind ia the first 
plsce induces the capitalist to sit tight on bis board. If be 
ipends anything it is for- his personal benefit. He is loth to 
spare > single penny without hope of profit. If at all ne 
extends help to a poverty-stricken man, it is not genuine 
help, but a means to exploit him, to extort more from him than 
in givan. If he shows favour to a destitute person, be seeks 
to bead him under the weight of * thousand obligations and 
mikes him fee] so Small that the poor creature loses .11 , erje 
of self-respect. If be dooates to . oation.l cease, he calculate, 
in .dvance The profit that will .ccroe l0 bim. Concerns which 
hold no promise of personal ad vintage to bim will not receive 
bis help. 

What ore the coaaequeaces of this outlook 7 The conse- 
quences are not only fatal for the society but also. In ths 
long rnn, harmful Tot that individual who dun to short- 
sightedness and ignorance considers this outlook as befitting 
to bis self- interest. In a society ridden by this outlook, money 
flows imo the hands of a few individuals and concentrates 
there, while countless others ire progressively bled of all their 
means Af the capitalist, through bis financial cnterpriea. 
aucks in more and more wealth, tbe poor sections of society 
grow poorer. A society in which poverty is wide-spread 
succumbs to various Ills. Its physical health deteriorates. Epide- 
mics break out among tbe popolace. The individual', will to 

P ^ 7 Cahh " * ra<lua11 * "VP* Ignorance 
triumphs morality declines. People resort to crimes in order 

to meet. their requirements. FinsUJy, they take to general taw- 



Iesraes*. Riots break out. The rich are liquidated ; their 
homes and properties are pillaged and set on flames. The 
capitalist class is thus wiped out of existence. 

If yon ponder over It you will realize that ia fact ihe well- 
being of each individual i& dependent upon the welfare of 

the society to which be belongs- If you lay out your wealth, its 
circulation shall eventually r«ult in its return to yon with 
several benefits. But if you are narrow. minded and hoard 
yoar wealth or use it for your own needs only, your wealth 
will progressively dtmini&b ia value. For instance, if you 
bring up an orphan and educate him and thus help him to 
become an earning member of the society, you in fact add 
to the wealth of the society. Obviously you will share the 
social prosperity thus enhanced, though you might never know, 
by way of calculation, how much have you actually gained from 
the productive labour of that particular orphan whom had 
you helped, But if you adopt a selfish and narrow attitude 
aod tay : why should I help him, hit deceased parents should 
hive made some provision for him, the orphan will become 
a helpless, worthless vagabond. He will never acquire suffici- 
ent skill to contribute to the wealth of the society. It would 
be a smell wonder if he drifts into the criminal world and 
one day burgles your own house. That means that you 
have not only wasted an individual by letting him loose in the 
world as a useless bum and a law breaker, but have also 
done a positive disservice to yourself. On the analogy of 
this example, if you look at the matter in a wider perspec- 
tive, you will realize thai the individual who selflessly 

spends on the welfare of the society, apparently loses money, 
but in fact bis money grows and gathers more and more 
value while in circulation, till It returns once more 10 his 
pocket along with several benefits. And the man who adopts 
a i«lfisb ajnd narrow view and hoards money and does not 
spend it on the welfare of the society, apparently saves' 
money or increases it by lending it oat on interest, but as a 
matter of fact he decreases his wealth by his own folly 


and brings ruin upon bituseK. This economic law has been 
described by the Holy Quran in (be following words 

"Allah hath blighted wury and made alms-giving fruitful". 

~ , (Al-Baqarah : 276) 

That which yon give io usury, in order that it may increase 

on (other) people** property hath no iocreafe with Allah 
bat that which you give in charity, seeking Allah's coun- 
tenance, bath increase manifold." (Ar-Room : 39) 
But short-sightedness and ignorance prevents man from 
grasping Ihii law end scting to accordance wi(b Jt. Mftn i* 
governed by bis senses Tb« money io his pockat is palpable to 
him. The profit balance in bit ledgers is the sure index for him 
of his flourishing fortune. But the money that goes out of fail 
bands is not visible to him. He has no idea where it is growing, 
how. and at what rate and when it wjli letnrn to him with added 
benefits and dividends. Ha koowt only that such and such 
amount has slipped out of his accounts for ever. This in> 
presion of the ignorance baa never so far been removed by 
human jgeauity or labour. The phenomenon n universal. 

On the one side is the Capitalist world where the entire 
business or life revolves oo the fulcrum of lot ties 1 BD d 

despite abundanc; of wealth, problems and hardships are 
getting confounded day by day. On the other side it ranged a 
growing faction of revengeful human beings who not only wish 
to expropriate ihe exchequers of the capitalists but also plan to 
overthrow the entire system of human civilization and culture. 
The dilemma has been unravelled by that Wi*e and All-know- 
ing Being who revealed the sacred book, the Quran. The 
key to this deadlock is fanh in Allah and faith in the day of 
judgment. U man senates his faith in Allah aod develops 
conviction that all the treasures of the earth and ihe sky belong 
to H,.n only, aod the governance of human affairs vests in Him 
and that He keeps accounts of escb particle in the univer&a and 
the good and the evil of man will be rewarded a D d punished 
with point btaofc Justice in the Herrater. it becomes quite easy 
fox him to rely upon Alfab instead of Us own j'udamenf and 

to spend his wosJth according to the injunctions of Allah 
and leave the gain or lost of tbli spending to Allah. What he 
spends with this conviction it ia foci a deposit with Allah 
tnd its account will be maintained in tbe boots of Allah. 
Anybody else in the world may or may not know about this 
■pending. Allah will certainly know of it. Others may or may 
not acknowledge his charity, Allah will certainty acknowledge. 
Aiid when Allah bat promised that He wit! give fall reward 
for it, it It certain that He will do so, in the life hereafter 
or both here at well as the hereafter.. 

In Hit Sharia, at a rule, Allah issues a general injunction to 
perform acts of piety and welfare, so that the people should 
adopt humanitarian ways in their every day lives. Next some 
specifio form of doing good is laid down, to that the people 
should particularly adhere to it. 

The tame Is the case with Zakat. There is a general 
rule as* well as a particular direction. On the one band we are 
exhorted to shun greed and stia|jneit, Tor this is the root 
cause of many eYda and the main source of sins- We are 
enjoined to follow the moral law of Allah, Who is showering 
Hit blessings and favours upon His countless creatures, 
though He owes nothing to anyone nor has anyone the 
slightest claim upon His favour. We are directed to spend 
ib the way cf Allah to the maxima o> to save as roach 
as we can spare from our needs, and to fulfil the wants of tbe 
poor and the needy out of these savings. We are required not to 
spare life, nor wealth in the service of the cause of Allah or in 
proclaiming (be word of Allah. If we love Allah, we must 
sacrifice the love of wealth for His love. This is a general 
direction. Side by tide with it it the specific order that if you 
accumulate this much amount of wealth, you must spend at 
least so much portion of it. in tbe way of Allah and if the yield 
of your land is this much, you must donate at least so much 
than of it 'to Allah. 

Again just as by making a few Rakeats of Saiit obligatory. 
It-is not meant that you snoald remember Allah only while 



offsring the Stilt and forget Hlo afterwards. Similarly the pre- 
scription of spending a small amount in tike way of Allah does 
not mean t bat only those people 10 whom this prescription 
applies should honour ii and tbese to whom il doc* not apply 
should tighten their purse string*. It alio doea not imply 
tbit ihe wealthy should spend ia lbs way of Allah only opto 
the prescribed rate of Zakat and rep»lse with acorn any 
needy person who comes after tbey have paid oat their obli- 
gatory dooeiion, or avoid other occasion* to serve religion oo 
the pretext of having already exasesred (heir Zakat furjd. 

Prescription of Zakat as aa obligatory duty doea hot mean 
so at all. What It really mcani ii that it h the minimum rate 
lobe spent in the way of Allah by each wealthy individual but 
if ha has the means to give more, he oiuit do so. 



Allah has issued injunctions about Zakat at three differeut 
places In the Holy Quran : 

1. Id Surah Baqarah it is said : 

**0 ye who believe 1 spcad of the good things which ye 
have earned, and of that which we bring forth from lac 
earth for you.' 1 (Al-Baqarah : 267). 

2. And In Surah Anaam it la waled that We have raised 
gardens and crop* on the earth for you. Hence 

"Eat ye of (be fruit thereof when it fruiteth, and pay the 
due thereof upon the harvest day." (Al-Attaam ; 141) 
Both these verses are related to tbe produce oftha land. The 

HaoD Jurists bold that apart from natural growths such as 
wood, or grass or reed, all other things which are produced by 
artificial means such a* C<"0, vegetables and fruit are subject 
to Allah's due. 

It is recorded la the traditions that Allah's due io the 
produce of the baratii lands (rain irrigated lands) at tSe rale 
of 10% and in the yield of the land which is irrigated by. man- 
made devices, he is 5% which is payable simultaneously with 
the cutting of (be harvest. 

Next it ia said in Sura Taubah : 
"They who hoard up gold and silver and spend it not in the 
way or Allah, unto them give tidings (O Muhammad) of a 
painful doom. On the day when it will all be heated io the 
fiic of bell, and their foreheads and their flanks and their 
backs will be branded therewith (and it will be said unto 
them) : Here is that which ye hoarded for yourselves. ■ 
Now taste of what ye used to hoard.". (Taubah : 34-35). 
"The alms are only for the poor and the needy, and thoic 
who collect them, and those whose hearts are to be reconcil- 
ed, and U> free ihe capton and the debtors, and for the 
cause of Allah, and (for) the way-farcr ; a duly Imposed by • 
Allah- Allah is Kuower, Wise." (AI-Taubat : 60) 

Next it was observed : 

''Take alms of their wealth, wherewitbtoou maycat purify 
then." (At-Taubah : 103), 



All the three verses reveal that the wealth which it accumulated 
and augmented remains unclean until the prescribed portion of 
it i> spent in the way of Allah. The only form of clcaaiiui U 
ii to let aside Allah 1 ! share of it aod pay it to His people. 

Tradrtlon reports that when the warning of severe retribution 
a sa i oat boar den of gold aed silver was revealed, the Muslims 
were sorely perplexed, for this actually implied that Muslims 
should aot save a dirham out of their earnings but should spend 
it all. 

Finally Hadrat Umar (Allah be pleased with him) appro- 
ached the Holy Prophet (peace aod blessings of Allah be on 
him) and apprised him of the people's perplexity. The Holy 
Prophet (peace and blessings of Allah be on him) observed : 
"Allah has made Zakat ao obligatory duty for you so that the 
real of your wealth should become pure and lawful for you." 

Hadrat Saeed Khudri (Allah be pleased with him) hm 
reported a similar tradition according to which the Holy Prophet 
(pe«ce and blessings of Allah be on him) obirrved : "When you 

have paid Out the Zakat from your wealth, you have discharged 
your obligatory doty." 

The verses quoted above reveal the order regarding the 
Z4kat on produce of lard and accumulated wealth in the form 
of gold and silver only. Traditions, however, contain injunctions 
of Zakat on mercantile goods and camels. Cows and goats. 
The taxable amount of silver is Dirham 200/- or an approximate 
weight or 52$ tolas. The taxable quantity o'f gold ia 7J tola*. 

The taxable number of camels is 5, of goals *0 ; of cows 30, 
and mercantile goods are taxable when their value Is equivalent 
to the price of 32J tolas of silver. 

Any body who accumulates wealth over and above the 
prescribed limit ii under obligation to pay l/40th portion of 
bis weallh as Zakat. * : 

As for the gold and silver, the Hanafites hold that even if 
the quantity taken separately does not come upto the taxable 
level but in aggregate reaches tbe taxable level of »ny one of 
these, tbe payment of Zakat becomes obligatory. If gold and 
silver are in the form of ornaments the payment of Zakat on 

228 KONOUlc 3TSTSU 09 Ut kU 

?auu i l obX }^ t y according to Hadrat Um„ «ad rWrWrfMBd 

£ ?T « • 5 hU BdoptCd thr * °P |nlon - Tradition record, 
met two women wearing gold bangle. And asked them ■ ■ 

whereupon the Holy Prophet (pew* bo on him) laid to hex 
, Would you like to be made to bangle, of Are on the Day 
of JudgmMi iwteed r Similar Umm-i-Salma (Allah be 
pleased with her) narrated : "I had an iDklet of gold, ( aiked 
the Holy Prophet (peace be oo him) : It Zakat due on ft V 
He (peace be on him) observed : if the value of the gold used in 
it oom» npto the prescribed limit and Zakat ha. been paid on it. 
then jt Is not (ix. impure holdiag). Both these Mictou 
establish that even when gold and silver are in the form of 
ornaments, payment of Zakat oq them ii obligatory jurf » it h 
obligatory if they are id the form of ready money. However an 
Zakat is payable on jewel* and precioua .tone.. 


The Holy Qu raft has mentioned eight charges on the Zakat 
fund. Their detail it p Ven irfSurah Taubah verse 60 a? follows: 
''The aJms ace only for the poor and the needy, and those 
who collect them, and ihosc whaw hearts ate to be recon- 
ciled, and to free the captives and the debtors, aad for the 
cause of Allah, and <for) the way farer ; a duty imposed by 
Allah, A»ab is Knower, Wise," 

The verse lays down the heads of expenditure of the Zakat 
The category of people who are to be assisted out of (bis fund 
have been clearly mentioned. Apart from this all other heads 
of expose have also been explained. Thus, the verse in fact 
throws light on the objectivei of economic uplift of the Islamic 
State. The heads of expense mentioned in the Terse arc briefly 
explain^ as under: 

1. The term Faqir i.e. needy applies to every person who 
needs economic help for Jiving. The term covers all types 
of needy persona, whether they have been permanently 
rendered helpless by physical disability or old a 8 e, or are 
helpless dw to a tempoiary setback and will stand on 
•heir own fcet if support is extended to them- In this 
latter category fall the orphans, widows, the unemploy- 
ed and the people who are overtaken by some 

2. Masakln refers to all those who bear the attribute of 
MasJcMQii*. poverty. 

The meanings of the word Mask mat include humility, 
helplessness and disgrace. Hence Masakla an those who are in 
a wor-e condition than the needy persons. Explaining the word 
Mijkin, the Holy Prophet »peace and blessings of Allah be On 
him) held those people as especially deserving help whose means 
are short of their needs and are consequently extremely hard-up. 
but their aelf-respect restrains them from begging, and their out- 
ward appearance does not reveal their actual misery to others. 
. A Tradition explains this as follows : 

Miskln is he who does not get provision according to his 
hare n eed, tor can he be identified as such to be consldeied 



for help nor does he itaod 10 beg." 

Id other words be is a noble soul stricken with economic 
poverty. It is the duty of ihe pious people of the society to 
identify and extend support to such Masaktn living around them. 

3. Aamiietn means the functionaries whom the 
Government employ* to collect, preserve and distribute 
the revenues of Zakat, and to maintain their accounts 
Such functionaries though they may not be Faqir or 
Mhkin their salaries are lo be charged on the Zakat 
fund. These words and the words of the Surah Taubab 
verse 103 13** r^'^ *J ^ establish the point that 
the collection and distribution of Zakat is one of the 
duties of the Islamic Government. 

It is noteworthy in this connection that the Holy 
Prophet {peace be on him) had declared that it was 
unlawful for him and his family to receive anything 
from the Zakat fund. He (peace be on him) himself 
performed the duty of collecting and distributing the 
Zakat always without any compensation what soever 
and laid down the rule for all the Hashimitcs to perform 
this service only noaorarily. He ;peace be on him) 
decreed that employment in- this department on salary 
was unlawful for Bam Hasbim. If the wealth of an 
Hashimiie was taxable for Zakat then it was his duty to 
payZakar, but should he be poor, needy, under debt or 

a traveller it was forbidden for him to take Zakat. It is, 
however, a moot point whether a poor Hashimite can 
take Zakat from an affluent Hashimite. According to 
Imam Abu Yusuf he can take it, but the majority of 
the jurists do not agree with him. 

4. Mufl/Za fmutqulub arc the people whose hearts are to he 
won to side with Islam* 

The purpose of this order is to pay permanent subsidies or 
temporary grants to the following categories of people in order 
to win their support and cooperation for Islam, or to secure 
their loyalty or at least to neutralise their opposition : 

1, Active enemies of Isfam who may be appeased by grants 

THft NAtUfcB OF 2 At At AND ITS fcfjlil 23l 

. of money. 

2. Infidels who may be lured from their camp by pecuniary 

award and made allies of Muslims. 
J. Fresh converts to Islam whose previous hostility waa ao 

fierce or whose present weal nesses arc such as to raise 

apprehension that, if taey were not given financial aid, 
they would relapse into infidelity. 

On this head, expenditure may be made from the 
(apoils of war) or other revenues or if need be, funds may be 
drawn from the Zakat. As regards the people of tHis category 
there is no condition that they should be poor or destitute in 
order to qualify for assistance from the Zakat Fund. They ate 
entitled to receive payment from Zakat even if they are wealthy. 

It ia aoeatab liihed fact that, in the time of the Holy Prophet 
(peace and blessing* of Allah be on him), several people were paid 
subsidies and graota in order to appease them. 

There exists, however, a difference of opinion aa to whether 
this head of expenditure was maintained after him or not. fc 

Imam Abu Hfltut'a aod his compaoiooa are of the view that 
from the time of Hadrat Abu Bakr and Hadrat Urnar (Allah be 
pleased with them), this head of expenditure stands abolished. 
Hence it is unlawful to pay any aid or grant for the appeasement 
of such elements. 

Imam Shatft holds that j-U (waveiing in faith) Muslims 
may be paid from Zakat exchequer in order to conciliate their 
hearts, but not the infidels. 

According tu certain other Jurists I he share cf 
(those whose hearts ire to be woo over) in the Zakat stands 
Valid, if arid when the need arises. 

The Hanafj school cites the following example in its support 
that'Oayniabin Hisn aod Aqra' bin Habis- applied (0 Hadrat 
Abu Bakr (Allah be pleased with him) for the grant of a 
particular piece of land after the demise of the Holy Prophet 
(peace and blessings of Allah be on him). Hadrat Abu Bakr 
(Allah be pleased! with him) gave them a written order of 
allotment. The two aKoiieei then mace a bid to make their 
allotment more authentic and get if endorsed by some other 


prominent companions. However when they brought the allot- 
ment order to Hadrat Umar (All J b -be pleased with him) for 
endorsement, be read ihe order scd tort it into piece* in their 
presence, saying. "The Holy Prophet (peace be on him) no doubt 
used to pay you subsidies in order to appease you, but that was 
the time when Islam was itttl in danger. Now Allah has made 
Islam secure from the menace of people like you." Oaynia and 
Aqra" went to Hadraf Abu Bakr and complained against Hadrat 
Umar, "Are you the caliph, or Umar V they, taunted. But 
neither Hadrat Abu Bakr look any notice of their complaint 
against Hadrat Umar nor did anyone else among the companions 
expressed any disagreement with Hadrat Ulnar's view. On this 
ground the Hanans conclude that when the Muslim a grew in 
number and gained strength to stand on their own feet, the 
reason for which an allocation in Zakat was made for the 
appeasement of hostile fitments virtually disappeared. Hence 
by consensus of tbe companions this bead of expenditure stands 

Imam Shafi'i (may Allah ihow him meTCy) argues that a 
precedent of grants from Zakat Exchequer to appease the in- 
fidels cannot be proved from the conduct of tbe Holy Prophet 
(peace be on him). All the instances lobe found in Hadiihptove 
only That the Holy Prophet (peace be on him) made grants to 
appease the infidels from the spoils of war and not out of the 
Zakat exchequer. 

In my view the correct position is that there is no valid 
argument for abolishing tbe share of (those whose 

hearts are to be won over) in the Zakat exchequer for good. 
There is no doubt that Hadrit Umar was right in his view. 
If tbe Islamic Government feels that there is no need to bear 
any expense for the purpose of appeasing anyone, it is under 
obligation to no one to act contrary (o its own opinion in .this 
matter. However, if and when the seed arises, the option 
should be kept open for the Islam ic Government to act in accord- 
ance with the- provision made by Allah under this head of 

Tha point on which Hadrat Umar and niner compan' v - . 

1HB NATURH or ZA£AT AND us Kuxu 233 

(Allah be pleased with tbtm) entered iolo a consensus wa» that 
under the conditions prevailing then, they felt no need to 
■ward pants to conciliate hostile elements. There is no valid 
jrcnnd Tor concluding from thii caie thai consensus of the com' 
paaions had abolished for good this head of expenditure which 
the Holy Quran Itself bad crested for sons Important religions 

As for loam Sbsfl'i 's opinion, it appears sound to the 
extent Inat when the Government has ample resources from 
other heads of revenue, it should not draw upon the Zakat 
exchequer to pay subsidies for the conciliation of hostile 
elements. Bui when <be need doe* arise to use ihe Zakat 
revenue, then there is no around for discrimination that it 
should be spent on the impious Muslims and not on infidels. 
The share allocated by the Quran to the heid 'payment fci 
winning over the hearts to Islam U not conditional upon avowal 
of Faith by the beneficiaries. The g.ouad for making this 
allocation is that Islam needs to win over the hearts of certain 
elements, who cannot be broaghc round except by money* 
"berever such elements exist and Islam needs to win them aver 
the head of the Muslims is authorised by the Quran to 
spend the requisite amount out of the Zakat exchequer. The 
reason why the Holy Prophet (peace be on him) did not pay 
anything to the Infidels under this head of expense was that ho 
(peace be him) had othet funds to draw upon. Otherwise If Jt 
had been illegal to pay the models under this head of expense, 
he (peace be .^n him) would have made it explicit. 

5- v^/ 1 J i.e. spending Zakat for the emancipation of 
slaves. This ixpensa may be made id two forms. One, when 
a slave has contracted to purchase his freedom from his master 
at a fixed sum, he should be helped to pay the price of his 
freedom. In the other form the Zakat money should be n*ed 
to emancipate slaves in general. About the validity Of the first of 
these two forma of expense, there is a consensus of opinion 
among the Jurists. The second form is heid illegal by Hadrat 
Ali, Saeed bin Jubair, Lalth, Thauri, Ibrahim Nakha'iy, Sba'abl, 


Muhammad bio Sirin, and the H*na£ and the Sbafi'i school, 
while lbo-i-' Abbas, Hasan Basri, Malik, Ahmed and Aba- Thaw 
consider it legal. 

6- ttebior i.e. Debtors who, if they discharge their whole 
rJebt out oT their own mean*, are left with an amount which is 
below the limit prescribed forj^akat. Whether sucb debtors are 
employed or unemployed, or have reputation of being paupers 
or prosperous, in bcth cases tbey are entitled to receive help from 
the Zakat cxch:qu?r in Order to discharge their debt. However 
sever il Juri^M are ^: ihe view that a man who has entered into 
debt after dissipating his. wealth ia vice and extavagance should 
not be assisted in the discharge of his debt until he renounces 

and repents for his past conduct. 

' .7. -»»' Jr- J i-e. to spend Zakat in the way of Allah. The 
phrase 'way of Allah' is general. All virtuous acts aimed at 
winning the pleasure of Allah fall under its meaning. Hence 
certain scholars have expressed ihc view (hat under this order 
the Zakat money can be spent in ail kinds of virtuous acts. But 
the truth is, and a vast majority of the past leading jurists 
subscribe 10 this view, thai the phrase. J*-- J connotes 
V 'iirugfje ia ihc wiy of. Allah, {bat is, struggle 

aimed at eliminating the secular system and establishing the 
system of lilam. . 

Those who engage in this struggle, even If they are pro- 
sperous and need no assistance to fulfil their private needs, arc 
entitled to receive from Zakat cicbequer travelling expenses, 
and costs of conveyance, weapons, ammunition and other 
necessities. Similarly, those who voluntarily offer their services 
and time on temporary or permanent basis for this work, 
may receive temporary or permaaent allowances from Zakat 
exchequer to meet their bare nee da. One further point which 
must be understood here is that for such occasions the provi- 
ment past jurists and scholars use the word j'A which is 
synonymous with war. Hence people usually imagine th« 
among the heads of expenditure of Zakat, the allocation made 
under the head -SI J,,- J ia me*n\ for war orfy. But in fact 



the term J~~ j ->Vr (struggle in the way of Allah) is bigger 
and wider than war. It comprehends all endeavours to curb 
secularism, proclaim the word of Allah and establish the religion 
of AUab as a way of life, whether those endeavours pertain ti» 
thu initial stages of preaching and propagation or the final 
stage or war. 

8. A traveller, when he needs help during journey, will be 
given help from the Zakat, even though tbat traveller be 
prosperous ut home. Some Jurists, here, have added the proviso 
that only that traveller is entitled to help according to this • 
verse, the object or whose journey is not sinful. But the Quran 
and Hadith contain no such condition. The basic teachings of 
religion tell ui that sinfulness of u person should not hinder us 
from extending help to hi-O. In fact the greatest means of reform- 
ing the sinners and morally depraved peopje is to lend them a 
helping hand in distress and to cleanse iheir souls by doing 
good to them, The question that remains now Is, under what 
condition is a person among these eight categories of people 

entitled to receive Zakat and uuder wbat conditions is he not 
entitled to it 7 

This question is answered id a little detail below H 

1. No one can give Zakat to his father or son. Zakat 
from husbund to wife or vice versa is invalid. On these points 
ibere ia a unanimity of opinion among the Jurists, Some 
Jurists also suggest tbat payment of Zakat to near relatives 
whose subsistence is your responsibility or who are your 
legal heirs io Shariat Law, is also invalid. However, distant 
relatives are entitled to receive Zakat from yon, rather they 
should be preferred to all other claimants. Btrt Troam Auiaa'i 
advises, " When you set aside a sum for Zakat. do not go about 

looking for the deserving candidates only among your own 

2. Oaly a Muslim and not a non-Muslim, has a right to 
Zakat. Zakat has been defined in Hadith as follows ; 

. "It will be taken from your rich and distfibnied among 

1. Adapted Siom oi-fci (Xcuibit)- 



yonr own poor." 

However, (be noo- Muslims may be given a (bare from 
general charity. Id fact it is implausible to discriminate 
between Muslim and non-Muslim in general charily. 

3. Imam Abu Haaifa, Abu Yusuf and Mohammad (may 
Allah show them mercy) hold thai the Zakat fund of each 
locality should be spent on the poor of thai locality only. 

To send Zakat from one locality to another is implausible, 
save when there is no deserving candidate there, or in the 
case of calamity such m flood or famine, help must be sent 
to the affected area from the surrounding localities. Nearly 
the same opinion ii held by Imam Malik ind Sufyan Thaurj 
(may Allah show them mercy). But this doea not mean (hat 
it is unlawful to send Zakat from one place to another. 

4. Some of the jurists suggest that a person who has 
provisions for two meals should oot take Zakat. Soma suggest 
thai anyone who has ten rupees <i2, rupees according to certain 
others should not take Zakat. But Imam Abu Haaifa (Allah 
be plea'ed with hirai and all other Han6 Jurists hold that an>- 
one who possesses less tbao Rs. SO/- is entitled to receive Zakat. 
This sun doei not include the value of the hous=, household 
effects, conveyacce or a servant. In other words a person 
who has less than fifty rupees over and above all these blongings 
can take Zakat. There are two distinct aspects to this case. 
One is legal, while tbe other is of moral excellence. The attitude 
of moral excellence ii indicated by a saying of the Hoiy Prophet 
(peace and blessings of Allah be on him) : 

"Anyone who has provisions for the morning and evening 
meal and yet solicits alms from people, gathers fire for 

According to another tradition the Holy Prophet (peace' 
be on him) said : 

*'I prefer that a person should cut wood and earn his 

living than stretch out bis band to beg." 

A third tradition contains this saying : 

"Whoso has something to eat and has the capacity to eain. 



ft la unbecoming for him to ukc Zakat." 
But this is a lesson of fortitude. As for law, it rcQui'tes 
that an ultimate limit should be fixed upto which a man is 
entitled to get Zakat. Thii may bo ascertained from other 
traditions. For instance, the Holy Prophet (peace be on him) 
observed : 

"The beggar hai a right even if be arrives mounted on a 
,borfe.' r 

A man enquired: 'I have ten rupees. Am I 'Siskin' 
(poor).' The Holy prophet (Peace be oa bim) replied : 'Yes*. 

Oace two men came to the Holy prophet (peace be on him) 
aud asked Tor Zakat. The Holy Prophet (peace be on him) 
(noked them up and observed : "If you want to take it, I will 
give it to you. But toe prosperous and sturdy people who 
have tho capacity to earn have no ihare in Zakat" 

All these traditioos eatibliih rbi* law : Whosoever possesses 

wealth which ia below the taxable limit for Zakat falls |Q the 
eatcRory of."yl(the poor eod the ttedy). Anyhow it is an 
established fact that only (bo*o persons have the right to get 
Zakat who are genuinely needy.' 

I have mentioned the essential rules or Zakat. But there 
is an Important and necessary point beside tbem which the 
Muslims have forgotten to-day aud to which I wish to draw 
your attention I.e. (hat everything in Islam is done within (he 
framework of a social organization. Iilam does not like 
Individualism. If you arc away from a roosQue and pray 'alone 
your Salat (Prayer) is valid ; but the will of Shariat is that 
you should pray in a congregation. Similarly in Che absence of 
a state organization for the collection and distribution of Zakat, 
it is permissible for every individual to set aside and distribute 
his Zakat on his own. Bui effort must be made to collect 
Zakat atone centre, wherefrom it should be expended in a 
systematic manner. This exactly is the point alluded Co in the 
Holy Quran : 

Take alms of their wealth, wherewith thou mayst purify 
tbem and roayst make than grow (9 : 103) 
Allah here orders the Holy Prophet (peace be on him) (o collect 



Zakat and not the Muslim, to allocate a«d distribute their 
Zakat individually. 

Similarly the provision for the emoluments to be paid lo the 
functionaries of the Zakat Organization also dearly shows that 
the correct procedure is that the Head or the Muslims should 
arrange collection and expenditure of Zakat in a systematic 

Similarly the Holy Prophet (peace and blessing, of Allah bo 
oa him) obiervad r 

"I have been ordered to collect Zakat from your rich and 
distribute it among your poor." 

The Holy Prophet (peace be on bira) and the right-guided 
Caliphs (Allah be pleaded with them) followed this very 
procedure. The entire Zakat was collided by the functionaries 
of the Islamic Government and it was distributed ander the 
guidance of the centre. To-day, if there is no Islamic Govern- 
ment and there exists no system of collection and distribution of 
Zakat you are free to allocate and spend your Zakat individually 
in accordance with the rule* laid down by the Sbariah. *But it is 
incumbent upon the Muslims as a whole to set up a central 
organization for the collection and distribution of Zak*at. for 
without such an organization, the benefits accruing from the 
institution of Zakat remain ineffective. 





a Q-e*tfMD«irei 

1. Define Zakat. 

2. Who if liable to pay Zakai ? What about the women, 
minors, prisoners, travellers, persons of unsound mind 
and pcrannj residing in alien lands 7 Discos* in detail. 

3. At what age shoujd a person be considered mature 
for the purposes of levying Zakat 7 

4. Whit n the position of ornaments in personal use of a 
woman for imposing Zakat. 

5. Should joioi stock compani;i pjy Zakat or the share- 
holders individually to proportion to the»r shares ? 

6. Explain the limits of Zakat liability for factories and 
"commercial concerns 7 

7. In the case of companies whose shares arc transferable 
who will be held liable at ibe time of assessment of 
Zakat ; the bnyer of the share or the teller ? 

8. In view of the present social let up. under what 
conditions and on what sort of assets i» Zakat liable to 
bepaid. What would be the position specifically in 
the case of (be following assets aod the problems 
accruing from them 7 

(a) Cash, Gold. Silver, 0/qi menu and Jewellery. 
<b) Metal coins {including those made of gold, silver 
and other metals) and paper currency. 

(c) Bank balance, articles kept in safe deposit lockers, 
loans, mortgaged property, disputed property and 
property liable to be made subject of a Civil suit, 

(d) Donations. 

(e) Insurance Policits and Provident fund. 

(0 Ca ttle, Dairy Products , Farm output Includin g 

\'Rta?r" ttd hoa Ta ^ ma "- kt -<l^ Mobsman. |m H/N»t V bvr 


grain, vegetable*, fnilt and floweri. 
(I) Minerals, 
(h) Treasure Trove. 

<i) Archaclojical finds. 
0) Wild and farmed hooey. 

(k) Fish, Peat It and otter marine ptoducti. 
(1) Petrol, 
(to) Import lad Export. 
9. Did the rifht-fQided caliphs (Allan be pleated with 
them) idd to the tilt of assets liable to Zakat in the 
time of the Holy Prophet (peace b c on him), If any 
addition or amendment was made to that list, under 
what rules was it made ? 
10. Are the current coins made of metals other than 
nickel, sold and silver liable to Zakat 7 Are coins 
which arc no longer legal tender, or are spurious, or 
those which the State at* called In or coins of foreign 
eountriei alto liable to Zakat ? 
4,11. DeBno visible and invisible wealth 7 What it the 
position of Bank depotiu in this connection ? 

12. What are the limits of liability In the case of productive 
wealth? Ii only the productive wealth liable to Zakat ? 

13. Whatrnles do yon propote for levying Zakat on such 
bouses, ornaments and other things as ire hired out as 

i a tt ° Q ,,xi ' C4 "' v**' other vehiclet. 

H. Which of tbo domestically owned animals are liable 

to Zakat? what about pet animals like buffaloes, hem 
etc not meant for comm:rcial purposes ? Can the 
Zakat on ihem be paid In cash or in kind or in both ? 
What number of domestic animals, and under what 
condition^ is liable to Zak at ? 

15. What should be the rate of Zakat on those various 

categories of goods and articles -which are liable to 

J«. Wii any 'amendment made in the time of the rightly 
guided Caliphs in the rate of Zak at on cash, coins, cattle, 



mercantile goods and farm yield ? If to, explain the 
reason* to detail and quote authorities. 

17, If a cash a mount of two hundred silver Dirbams and 
twenty golden mithoal is liable 10 Zskat. what is their 
equivalent in Pakistani.eurreocy. la (be case of grain 
Sa*a and Vasaq (^>-j)are equivalent to which scale 
of weights and measare* now enrrent in various parts 
and provinces of Pakistan ? 

13. In view of the present circumstance* can any alteration 
be made in the Nliab (minimum ceiling of wealth 
liable to Zakat) and the rate of Zakat ? 
Give your views with argument! on this issue 7 

19. After what period does Zakat become due on various 
categories of weelth aod other assets 7 

20. If the land yields more than one harvest in a year, is 
Zakat due only oace a year or noon each harvest 7 

21. Should Zakat be levied according to (he lunar calendar 
or the solar calendar ? Should a month be fixed for the 
assesiment and collection of Zakat ? 

22. What should 6e the headi of expenditure of Zakat ? 

23. Explain the extent of the various heads of expenditure 
of Zakat at laid down in the Holy Quran ? Elucidate In 
particular the meaning aod substance of the term 
* tV- J. i-e- in the way of Allah. 

24. Ii it essential that allocation be made from the Zakat 
to each bead of expenditure [aid down by the Holy 
Quran or can the whole Zskat money be allocated 
to just one or a few of ttio;e heads of expenditure ? 

25. Who is entitled to Zakat aod under what circumstances, 
from amongst the various categories of deserving people? 
Explain Ld the light of circumstances obtaining in 
various parts of Pakistan, wheiher and to what extent, 
are the Syeds and the descendants of Banu Hashim 
entitled to take Zakat? 

26. Can Zakat be giveo only to individuals ? Or can it also 
be given to institutions, i.e. educational institutions. 



orphanages, welfare home* for the poor and the 
invalid ? 

27. Can subsistence allowance in the form of a lire pension 
be granted out of Zakat exchequer to the deserving 
poor, dostltute persons, widows and handicapped or old 
persons unable to earn their living. 

28. Can Zakat be spent on works of public utility such as 
the building of mosques, hospitals, roads, , bridges, 
wells and water tanks from which every person without 
distinction of creed or nationality is free to derive 

29. Can Zakat money bo advanced as loan to be 
repaid as and when possible or as loan without interest. 

30. la it essential to spend Zakat in the same area from 
which it li collected ?*Or can it be spent outside that 
area or even outside Pakistan for reconciliation of 
hostile elements or in aid of persons afflicted by natural 
calamities such at quakes or flood 7 In this connection 
how would you define an 'area' 7 

31. What procedure should be followed to collect Zakat 
from the legacy of the dead ? 

32. What precautions should be taken to prevent people 
from evading payment of Zakat ? 

33. Should (he collection and administration of Zakat be a 
provincial or central subject ? If it should be a central 
subject, what rules should be framed to allocate shares 
to provinces or other areas ? 

34- What in vour view is the best system of administration 
for Zak'.t ? Should a separate department be created 
for the collection of Zakat or should this function be 
assigned to the existing departm=nts of the Government 1 

35? Was Zakat ever declared as official cess, or is it a cess 
regarding which the Government's responsibility was 
Uznited to collection and distribution only ? 

36. Was any tax for public business imposed beside Zakat 
during the period of the Holy Prophet (peace be on 

ins natuhb of zatat and its mxjtn 


him) aad the rightly guided caliphs (Allah be pleased 
with them). If so. what tort of tax it was ? 

37. Waat procedure hat been followed In Muslim couotrle* 
for the collection ud distribution of Zakat? What is 
their current procedure 7 

38. Should the administration of Zakat stricry remain in 
the hand of the Government or should a Board of 
Trustees be constituted for thji purpose under the joint 
supervision of Government and Public 7 

39. What pay scales, allowances, pension and Provident 

fund rales and terms of service do you propose for the 

staff recruited for the collection and distribution of 
Zakat 1 




1. The literal meaning of Zakac is purity and nourishment 
It is in the context of these two virtoes that the term 'Zakat* 
denotes that financial submission to Allah which has been 
obligatory for every Muslim poKesring wealth of a requisite 
amount, so that, after discharging the light of God and the 
people, his weaKh is purified, and hw soul too ; and further, the 
society in which be Jives is cleansed of the vices of miserliness, 
selashness, and feeling* o f animosity and, in their stead, virtues 
such as love and kindness, generosity and mutual co-operation 
and brotherhood are nourished. 

The jurists have given various definitions or Zakat, For 
instance : 

**Jt is a right Imposed upon wealth." 

(At-Mugkni Li tbn Qudtma, Vol. 2, p. 433) 
"To give a portion of the Nlsab (wealth liable to Zakat) to 
a needy p.rsoa or a person like hime, who is free from 
any disqualification to take Zakat." 

{Noll-ul Awtar Vol. 4, p. 98). 
"To hand over a particular portioa of wealth according to 
given condition* to on eligible person." 

(Al-Jiqh 'Ala ai Madhahib Al Arb'a Vol, I, p, 590). 

2. Mature Muslim men and women or sound mind who 
possess wealth to the limit liable to Zakat are bound to pay 
Zakat and it is their personal responsibility to pay it. 

Opinion is varied with regard to minor children. One uiew 
is that the orphan is not bound to pay Zakat. Another school 
of thought holds that, when the orphan atiains maturity, the 
guardian while handing over the charge of the property to him 
should also acquaint him with his total liability of Zakat. 
Afterwards it is upto the person himself to discharge his total 
liability of Zakat for the period of his orphange as a minor. 

The third view-point is that if the wealth of an orphan is 
invested in some business and is earning profit, his guardian 
should pay the Zakat oa his behalf. Otherwise if the wealth is 
earning no profit, no Zakat is payable. 


The fourth school of thought holds that Zakat is payable 
on the wealth of an orphan, and the responsibility for paying it 
ties Witt his guardian. I a>era this last view-point to be more 
correct. Tradition states : 

"Behold, the guardian of a wealthy orphan should invest 
bis ward'* wealth la some business and should not keep 
it idle lest the whole of it should eventually be consumed 
byZakat/'<r/r«irf*j//l» QutnllBrihAqiiKiub-uUmnat Llabi 


A tradition bearing the same meaning has been* recorded 
on the authority of others by Lmniu. Shafi'i and another tfadition 
has been reported by Tibrani and Abu Ubaid directly which 
is corroborated also by several sayings of the companion* 
and their followers, such as HadratUmar, Ayesha, Abdullah bin 
Umar, Ali, Jabir bin Abdullah (Allah be pleated with them) 
and from among the followers Mujabid, AUa, Hassan bin 
Yazjd, Malik bin Anas and Zuhri. A difference of opinion of 
a similar nature as above also exjats with regard to iosane 
persons. Hero again the correct position, in my view, is that 
the wealth of an insane person it liable to Zakat, and its 
payment is the duty of his guardian. An explanation of this 
view has been given by Imam Malik and Ibn-l-Shehab Zuhrt 
(may Allah show them mercy). 

The prisoner is also Liable to Zakat. The agent who is 
managing his business or property will, alongwith discharging 
other liabilities, also pay Zakat on hh behalf. 

Writing on this topic Ibn-i-Qudama in his work, Kitab-ul- 
MughnI, says : 

"If Ibe owner of wealth is seat to prison, his liability of 
Zakal does not end, regardless of whether his imprisonment 
has separated him from his wealth or not, for his ownership 
of wealth » legally Intact and the sale, gift and power of 
attorney of bis properly are legally enforceable acts." 
_ - (Vol. II, p. 446) 

The traveller is also liable to Zakat. There is no doubt 
that as a traveller he is also entitled to get Zakat, But this 
does not imply tbat if a traveller possesses an amount of wealth 



wbJ<4i , S liable to 2akat,h*w exempted from the payment of 
tb,s doty. Became he is in journey, be deserves help from 
Zakat; but because be » wealthy, he is duty-bound to pay 

A Muslim citizen of Pakistan who Is resident in a forcijm 
country ,s Hable to pay Zakat only if hi, wealth, property^ 
buaineu m Pak.stan comes up to the limit at which Skat is 
payable, A Muslim citizen. of a foreign Muslim State who is 
resident « Pakistan is liable to pay Zakat if hi, wealth, property 
or business m Pakistan comes up io the limit at which the Zakat 
* payable. As regards the Muslim who is the subject of a oon- 
Muslim $ uie, but is resident in Pakistan, he cannot be forced 
Maioit his wiU to pay Zakat, for his constitutional status i. no 

And those who belitved but did not leave their home. ye 
have no duty to protect them till they leave their homes 

llnJ^^ k "° v bAf t0 the «^»ion of the liability of Zakat.' 

^ "aches the age of matnxity his Zak.t Uability 

J? £ v If ir f* °? ^ J**' by * 0n staining 

ma.unty when he takes charge' of bis property, the duty of 

paying Zakat devolves oo him. y 

4. There are several opinions as regards the Zakat on 
ornament,. One scbool of thought holds that there is oo Zakat 
on ornaments. Undiog ornaments to someone is equal to 
Pftyug Zakat on them. This opinion is pu [.forth by Anas bin 
^^*t blQ MuSSi " ib ' Q atfld » »< Sha'abi. The second 

Il^r ,5 1 U Suffic " to W Zftkal on ornaments only 
once in a lifetime. y 

According to the third view there i 5 no Zakat on ornaments 

Tnuirf 8 Tm" 1 V? C0B * Mt k Ornaments kept largely 
unused are liable to Zakat. * 7 

^ a I^!/T\ OP . iaion " ttftt 2akaI is P*y*W 0 on all kiDds of 
correct on the following grouoda • v 00 

Firsts the- words of the" tradition which contain the 

tUB NATUU OP a«UT AND tl» *UUS 24? 

injunction of Zakat on gold and silver arc general, for instance ; 

aj-w ^ o^ju. ^ ^uji tfi Uj ^ 

24% Zakat is to be levied on silver and there is no Zakat 
on less than five auqiyas of silver. 

There are several traditions and reports explaining thai 
ornaments are liable to Zakat. Hence Abu Dawud, Tirmidhi and 
Nasal have reported the following tradition from the most 
authentic source ; 

A woman called on the Holy Prophet (oeace be 011 him). Her 
daughter who was wearing bracelet* of gold accompamed 
her, The Holy Prophet (r*acc been ijirn), asked ■ 'Do you 
pay Zakat on this 7" She replied "No", whereupon the 
Holy Prophet (peace he on him) obscned : 

"How would you like it if Allah, on the Day of Judgement. 

give* you to wear bracelet* of fire instead of these." 

Further Mowatta, Abu Uawud aod Dax Qulai have recorded 
Lhe following laying of the Holy Prophet (peace aod blessing, of 
Allah be on him); 

The ornament*, for which you have paid the Zakat are nut 

Ibn-i-Hazam states in Hohalla that Hadrat Umax had 
included the following directive in the edict which he had sent 
to hia Governor Abu Musa Ash'ari : 

Order MuJim women to pay Zakat on their ornaments 
Hadrat Abdullah ibn Masud w> asked to give his opinion 
04 to what was the verdict regarding ornaments ? lie answered : 

'"When its value comes u P to twn hundred Dirhams. it is 
liable to Zakat" 

Statements to the same eneci ar.e reported to have been 
made by ibn Abbas, Abdullah bin 'Arm bin' 'Aai and 
Hadrat Ayesha among the illustrious companions and Saced bin 
Muaayylb, Saeed bin Jubair, Ata. Mujahid, [bn Seerin aod 
Zohri from among the followers and Sufian Thauri, Abu Hanifa 
and their companions from among the jurists. 

5. With regard to the companies, my view is that with the 


exception of those shareholders whose share falls below the 
limit ofliability or who have hold the share for less than one 
year, the Zakat on toe shares of all otW holders should be 
jointly paid by the company. This procedure has the virtue of 
being administratively convenient as well as not being opposed 
in any respect to any basic rule of Shariah. Further, my view is 
also io accord with the opinion of Imam Malik, Shaffl'i and 
several other jurists! (Bidayat-uI-Mujtahld Vol. I p. 225) 

6. The machinery and instruments of a factory are not 
liable Co Zakat. Zakat shall be payable on the value of ^the raw 
material, mannfactuied goods and the cash balance which the 
company at the end of a year. Similarly no Zakat is 
to be levied on the furniture, statiooery, shop, house and other 
such property of the merchant. Zakat shall be payable only on 
the stock for sale or the cash balance which the merchwt 
possesses at the end of a yeax.l 

In this case the rule is that the meant of production in 

possession of a person are exempt from Zakat Tradition 

'The eameli which a man employ* on irrigation work are 
exempt from ZakaL" {KUa^ul-AmwaO 
This it because the Zakat of the camels is paid oui oT the 
harvest which has been raised by their labonr. On the analogy 
of this example the jurists have unanimously exempted all instr- 
uments of prodaction from Zakat. 

7. When the exchangeable shares of a company are sold 
in the course of a year, (he Zakat on them is payable neither by 
the seller nor by the buyer, for none of them has held the share 
for full on; year. 

8. The commodities liable to Zakat in Shariah are as 
follow i : 

Agricultural produce (after harvesting the crop) gold and 
t. Buslnsses vfafcb do not lea* rtwaielvw (o computation jo ihf. 

aeeerduv to pravaltnt exttod. nn the bait, oftbeir aonoal inco*. and 
upon (hew »scii Zakat <fac** be J«vj«d. 



silver, (when their value at the beginning or cod of the year 
comes upto or rises above the limit of liability). Similarly cash, 
which represents gold and silver deposits, cattle kept for 
breeding whose value comes up to the limit of liability at 
the beginning or end of the year and Minerals and Treasure 

(a) Cash, gold, silver and ornaments are liable to Zakat. 
la the case of o^iaraeais, Zakal will be levied on the actual 
weight of gold or silver u*ed in than. Jewels, Whether studded 
in an ornament or separate, are exempt from Zakat. However 
a dealer in jewels will pay the same rale of Zakat as on other 
trade goods, i.e. 2*% of their total value. 

The book M-Fiqh 'AM hfadhahib i\ Arbtta stales : 

"Pearls, and all otber jewels, if they are not kept 

for trade purposes, are exempt from Zakat. All schools of Fiqh 

ait agreed on this point." 

(vol. i,p. m) 

(b) Metal corns and paper currency arc liable to Zakat, 
for their value is not baied on the mciai or paper used in them, 
but on the purchasing puwer with which they have been invested 
by la*, and thus they represent gold and silver of the same 

Al-ftqh •Alal htw&ahib it Arba'a says : 
"The consensus of opinion among the jurists is that paper 
money is subject to Zakat, for in practice, it represents' 
gold and silver and it can be freely exchanged for them in 
ibe market. Hence from among the leading jurists, the three 
i.e. Abu Hanifa, Malik and ShaB'i "(may Allah show them 
mercy) hold that paper currency i* liable to Zakat." 

(Vol. I, p. 60S) 

(c) Bank deposits are liable to Zakat. If otber institutions 
are registered and subject to audit by the Government, their 
deposits too are liable to Zakat. But if they are not registered 
nor cad their accounts be audited by the Government, their 

deposits fall under the definition of J'j- 1 , i t. undeclared 
assets which Government cannot levy Zakat. In that case the 

250 * ' "" OF 13 LAM 

liability. If he mwtt lhc loan in b ^ incj$( u m ^ 

Some jurists held thai Zakat on them should be paitJ >car 

ab.r b. Abdullah, Tajos. Ibrahim Nakhai and Ha*an Ba.ri 

Some hold that no (Q e tecovcry of such loans all 

I^hool W " Th8Ur ' SufyiU1 tbAari lhe 

ir, bowtver, tttc'recoveryoftheloin^isdoub[ful r itwi>u1d 
» correct m my view that if and whan the loan is recovered 
>oJy one year's Zakat should ba paid oa it, This v.ew ha* be«B 
Jul forth by Hadrat Umax bin Abdul AziZ, Hasan, Laith 

" TJr? Mal " il ^iu.t.o^oatothe 

.nieren. of both the Bait-ul-Mal (Public Exchequer) and the 
owner of ibe capital. 

Zakat on mortgaged property will be levied on tho occupant 
>f the property. For instance OD mortgaged l*nd will be 
uvied on mortgagee if he also takes possession of rhe land The 
ttatof property under dispute shall be taken from its occupant. 
Vhen the dispute- is settled, the Zaka. shall be paid bv the 

£ ™ * l ° the 5ubjeciof a k * al >ame as 

ibova. Whoso occupies it, pays Zakat on it for the duration of 

aas occupancy, for he who benefits from a thing also pay* 
liabilities on it. 6 * ' 

(d) If tho value of a gift comes upio lha level of liability 


of Zakat and a year passes since Che sift was made, Zakat cm it 
sball be paid by the donee. 

(e) When contributions to lasurancc and Provident fund 
are compulsory, the order concerning them is the same as for 
luans recovery of which is doubtful,(hat is, when their amount is 
returned, only one year's Zakat sball be payable on than. 

But if contributions to Insurance and Provided fund arc 
voluntary, then in my view, Zakat ou the accumulated deposit 
in the Insurance or Provident fund should be levied on year 10 
year basis, for althou-h the accumulated amount cannot be 
recovered by the owner before a fixed dale, yet he has put moucy 
in the- fund voluntarily and hence there is no reason why this 
sum should be exempted from Zakat. 

( f ) Cattle in a Oaity Farm are instruments of pr eduction 
and, therefore, exempt from Zakat. However, the products of 
a Dairy Farm are liable to Zakat in the same way as the 
products of otter industries. The agricultural commodities 
which can be >tr>rcd are liable lo 'Uahr or half 'Uehr. The 
Name rule applio to fr.ut which ran be :.lo«e<l «uch as dry f'tujr, 
dry dates. Produce of rain-fed lands is subject to Ushr* 
Produce of the lands irrigated by artificial devices is liable lo 

Vegetables, flowers and fruit cannot be stored. Hence 
they are not subject tn «Ushr. But if their grower sella them in 
the market, commercial Zakat will be levied, provided the 
amount of sate crimes upto the limit of liability. The limit of 
liability shall be in accord wiih the standard applicable to thin 
trade, that is. the capital of th]* business should amount to 
two hundred dfrhams Or above at the beginning or cod of 
the year. 

(g) As regards minerals, the best view, in my own ion has 
been put-forth by ihc Kanbali school of Flqh, i.e. all things 

extracted from the earth, metallic or fluid (Petrol, mercury etc.) 

are subject lo 2,% Zakai, provided that their value comes upto 

the limit of liability and They are under privateowQejahjp. This 

tule was in force io the reign of Hadrat Umax bin Abdul Aziz 



(may Allah show him mercy). 

{Ai-MughiM Li-ibn Qudama, Vol. II, p. 58!) 

<h) Regarding Treasure Trove the Hadith says ; 

20% Zakat shall be levied on Treasure Trove, 

(i) Relics, or Antiques kept as mementos in homes are 
exempt from Zakat. However if they arc kept for sale, commerci- 
al rale of Zakat shall be charged on them. 

-(j) As for hooey, there is some difference of opinion whether 
a certain quantity of it is subject to Zakat or commercial rate of 
Zakat should be levied on its sale. The Hanafis hold that honey 
by itself is subject to Zakat and this vie* it supported by 
Ahmed, Ishaque bin Rahwaih, Umar bin Abdul Aziz, Ibn-i- 

Umar and Ibn-Abbaa. At least one statement of Imam Sbaffi'i 
also affirms this view. On the other hand Tmatu Malik and 
Sofyw Thauri say that honey by itself is not subject to Zakat. 
A famous maxim of Imam Shaffi'i seconds this view. Further 
Imam Bukhari states that : 

"There is no authentic tradition regarding the Zakat on 


In my opinion it would be fair to levy Zakat on the trade of 

(k) Fish by itself is not subject to Zakat, but the same rate 
of Zakat is to be charged on Us trade as on other trade goods. 

Pearls, j~* and all other things extracted from the sea come 
in my view under (he definition of minerals and the same rate of 
Zakat should be charged on them as has been described under 
the heading of "Minerals" according to Imam Malik. 

Hadrat Umar bin Abdul Axiz (may Allah show him mercy) 
acted upon this ruling during his Caliphaie. 

(fDrab'ol-Afnwal, p. 349 ; Kiab al-Mughnl U-ibn 
Qudama, Vol. H.p- 584). 

(I) The rule regarding petrol has been described under the 
heading 'Minerals*. 

(m) Export is not subject to Zakat. The custom on import 
which was levied during the period of Hadrat Unur (Allah be 
pleased with him) was not Zakat, but a recip/ocaj tax on imports 


from those Mighbcniring statu which charged a duty on the 
incoming goods from the Islamic Slate. 

9. During the period of the rightly guided Caliphs no 
addition of an independent and permanent nature was made 
to the List of goods subject to Zakat as correct in the time of 
the Holy Prophet (peace and blessings of Allah be on nira). 

Only those items were added to the Holy Prophet's list whose 
inclusion could be justified on analogy. Foe example, Hadcat 
Umaj bin Abdul Aliz added buffalo uo Ihe analogy of cow and 
levied the same Zakat on buffalo as ihe Holy Prophet (peace be 
on him) had prescribed fur the cow. 

10. Zakat xball be levied on all types or coins. See details 
»n No. 8 aub-heading 'b* above. Coins which are out of data 
spurious or have been withdrawn by the Government are subject 
to Zakat if they contain gold or silver whose value comes upto 
the limit of liability. When foreign coins are easily exchangeable 
with the coins of our own country, they shall be counted as 
currency. When they are not exchangeable, Zakat on tbein shall 
t* charged if The quantity of gold and silver which thev 
contain comes upto the limit of liability. * 

11. j|UiJ l * Visible wealth is that which can be inspected and 
assessed by a Government agency and Ju invisible wealth is 
thai which cannot be inspected or assessed by a Government 
agency. Bank deposits fall under ihe definition of -LL t | L 
visible wealth. * 

12. ^ JL- is that which has natural potentiality of repro- 
duction or which can be mutiipled by effori or action. According 
to this definition, Zakat has been levied on only those things which 
aro^U productive. Zakat on cash deposits is charged because th^ 
owner has blocked ingrowth. 

13. The value of things which arc hired out should be asses- 
sed from their profit according to current rules and 21'/ Zakat 
should be levied. Laith bin Saad reports : 

"I saw that the Zakat cm camels which were hired out was 
Charged in Medina/* ; Wtab^-4mwaJ f p. 376). 


buffalo, goal and animals like 
them) arc ra.sed for biding and their value comas unto or ™ 
abov, the limit of Ability theysbaH be 5 ub£no^e tc raCTf 
Zakat as the Shariat has prescribed for cattle 

(For details „ this pome , cfer l0 Sirat-un-Nabi. by 

Syed Sulftiman Nadvi, Vol. S, PP . 165-167) 
If.bowevcr, the ca.tle ii kept for sale, commercial Zakat shall 
be tevied on them ,.e. ,f their value comes upto or rises above 

rrcr (which i! ~ *% 

If the cattle is em pi ovcd ia agricu i Iural work or carrj 
a person breeds an an.mal for private Zakat is to be 
charged, whatever the number or value of the cattle 

Zakat shall be leved on them. If a F ouhry farm is set up for 
trade m egg*, the same rule will apply a, has been prescribed for 
the dairy farm or other industrial units. Hie Zakat on cattle 
may be charged m casb or kind i.e. cattle itself may be given in 
Zakat according to a ruling of Had,,, AU. 

(Kitab-ul-Amwal, p, 368)< 

15. The rate on various commodities liable lo Zakat is a* 

Agricultural Produce : 10% if the land is rain-fed. 

i% if the land is irrigated by artificial 

Cash, Gold and Silver : 21 e / 
Trade Goods: 2 ,ij 
Cattle : Refer to the deiailed table given in Volume V of 
Sirat-ux-Nabi by Syed Sulaiman Nadvi as men- 
tioned above 
Minerals : 2 .«, 

Treasure Trove ; 20V 
Industrial Goods : 2 {% 

mJ£ f^v v am ^f, m . ent W " madciQ the ,in5c ofthe'rightly 
juried Caliphj (Allah be p| W d with them) in the limit of 


liability and rate of Zakat as prescribed by the Holy Prophet 
(pew* and blessings of Allah be on him), nor is there any need 
to do 50 to-day. i am or the opinion thai no ore after the Holy 
Prophet (peace be on him) is authorised to amend the limits fixed 
by him. Whatever was prescribed by the Holy Prophet 
(peace be on him) a Muslim hai implicit and whole-hearted 
belief in it and no one who really has Faith in Allah and the 
holy p r oph c t (SAW) can ever imagine to evade his injunction- 
nay he will carry out his injunction willingly and voluntarily. 
But the soundnew of a law framed hy someone else, even a repre- 
tentative assembly, the Muslims can never accept unconditionally 
■nd therefore they may he templed to adopt all sorts of evasive 
tactics, a* is commonly done by people in The case of other ta«s. 
Hen« Zakat, which in reality i< a fonn of submission to Allah 
and one of the articles of faith in Islam, should not be brought 
to such an hazardous pass where Muslims cannot discharge their 
duly with complete honesty and in full faith. 

17, The limit of liability in the case of cash, silver, mercan- 
tile goods, minerals, treasure trove and industrial goods is 
^hundred Dirhanii. According to the research of Maulana 
Abdul Hai Faring! Mahali. two hundred Dirhnras worth of 
tZ^r^ 10 ^? 6 * 1 * Df °**™try comes to 

wl mation >* 52J Tola.. Another research of MauJana Abdul 

* ! J* th h * 1 h Z ° " ilhqi1 ° f M ° id iS eqU,J '° 3 To,a 2 Mas ^ * 
Tol» 11 '* COmmunly ,bou * hl 10 be equivalent to 

According to the computation of Ritabvt-Amwal Uabl 
Vboid i weight of Ten Dirhams « 82 3 grains of barley - l 

18. TWs has been answered in N 0 . 16 above. However a 

change can be made in the Limit of liability cm gold for the limit 20 

nnthqaU in this case is derived from a tradition of a very weak 

Except Minerals, Treasure Trove, and Agricultural 
Produce, In all other cases, it is a condition that ZakaHill be 



levied only when a person has had in bis possession goods upto 
the amount of liability or above for full one year. The condition 
of one year's possession docs not apply to Minerals and Treasure 
Trove. Upon Agricultural produce, Zakat shall be cbvgeablt 
as soon as the crop has been harvested, irrespective of whether 
two or more crops are harvested within a year. 
The Holy Quran obeerves: 

"Pay Allah's right on the day of harvesting the crop. 

20. The answer to this question has already been given in 

No. 19 above. 

21. Since all financial business is conducted these days m 

accordance with ttu Solar Calendar, there it no objection to 
following this same calendar in the matter of Zakat also. The 
adoption of 1-unar Calendar in the case of Zakat is not 
decreed in the holy Quran. _^ _ ^ . . » 

Neither any particular month has been fixed by the Shariah 

fot the collection of Zakat. 

In whichever month the Government starts the operation to 

collect Zakat, that month may be taken as the first month in the 

Zakat calendar. 

22. & 25. Eight heads of expenditure of Zakat have been 
laid down in the Holy Quran. They are ; 

The poor , the destitute, functionaries of the Zakat 
department Sljfj , winning over the hearts of aliens 

v»yiJ! *iJ*>-, freeing the slaves v'Jj. relieve the debtors 
in the way of Allah -3' J*- J and to help the traveller Of 1 . 

The term poor^i* refers to every person whn is dependent upon 
others for his living. This word covers all types of needy persons 
including the old or physically handicapped peopl* who are .in 
permanent need of help and those who for some temporary 
circumstance have been reduced to a dependent status and ean, 
with little assistance be rehabmtated such as orphans, widow*, 
the unemployed and people who have become v.cbm of emer- 
ges. ; 

-jhe term fdiskin, destitute has been defined id Hadith as 


follows : 

""mo person who earns less than his minimum need, but his 
condition is oot easily detectable for ibe people to help him, 
not does be come forth and beg altos from the people." 
According to this definition, the Miskin or destitute is a man of 
noble character who strives to earn his living, yet cannot earn 
enough to meet his needs. Seeing that he is employed, the 
people do not help him : and he is too wlf-rcspectiog to see* 

assistance from the people. _ 

The lerrn functionaries prefers to the staff who collect, 

distribute and maintain the accounts of Zakat. Irrespective of 
whether they arc themselves liable to pay Zaltat or not, they shall 
4>e paid salaries from the Zakat Exchequer 

The term ^ i refers to the people whom »t is intended 
cither to octet from opposition or to persuade them to serve the 
came of the Islamic State and there is no alternative but to pay 

money to them for this purpose. 

This term also covers those who* faith »s too weak 
to motivate .hem to help promote the interest of I^Mmmt 
both citizens of Islamic State and the aliens can benefit undet 
head of expenditure. Even If these people themselves a* 
,i»ble to pay Zakat, they are eligible to receive Z*kat if and 
when the Islamic SUte decides to enhst their 

I do not subscribe to the idea that the v^l ^ head of 
expense s.ands nbohAed for ever. Hadrat Unr. «mm-n 
concerning this head of expert *« relative to »n own ume 
and does noi hold permanent validity . 

By the term s*, **** slaV «- To ^ ** 

, mH Rrloation "f slaves falls under this head. At a when 
emancipation oi wllv rernain deflincl . 

slavery does not exist, this heao 01 e*pcQ« - B€ .k.„.- 0 
The term refers to those debtors who ^discharging 
.heir debt are left with an amount of wealth which falls below 
t limit of liability for Zakat. In such case no <"» 
be made between those debtor who earn and those who do 

n ° tC T tt C rm S fr-J in the way of Allah signifies -Jihad 


■coaomc tYirau ot uiau 

(ttfugfte) in the way of Allah' '.whether tbis struggle is waged with 
sword or pen or by physical labonr and exertions. No odc among 
the older scholars has lata this, phrase io mean social welfare 

It is commonly agreed that the meaning of the phrase is 
limited to the efforts nude to establish and propagate, the 
religion of Allah and to defeod the Islamic State 

The term J*- ^1 i.e. the traveller, although he may be 
affluent at home, but when he is on journey and requires help, 
he is eligible to receive assistance from the Zakat Exchequer 

24. It is not essential that the Zakat revenue should be 
spent on all ihe heads of expenses prescribed by the Holy Quran 
The State can spend citable amounts on selective heads accord- 
ing to i. s discretion and. if need be, it can allocate the entire 
Zakat revenue to just one head of expense. 

23. Among those who deserve Zakat, the poor and the 
destitute are entitled to Zakat only if thnir possessions i«(| below 
the limit of liability for Zakat. As regards the fy^i^TZ 
the Zak.t Organization and <i>- those whose hearts afc 

to be reconciled, even if they arc tffloent enough to be liable to 
Zakat, ibey are entitled to receive payment from Zakat 
The very fact, that a person h a slave, entitles him to assistance from Zakat in order to enable him to secure 
freedom from slavery. The debtor c« receive Zakat only if 
after ^barging hi, debt, his wealth falls short of the limit 'of 
liability for Zakat. ™ 

mtr«nJte J«JI tf l t is entitled to Zakat, if he need, 
help during hu journey. The descends of the clan of Hash.m 
are not eligible to get Zafcat. But to-day in Pakistan it » verv 
hard to identify who ii a Hasbimi.e and who is not HeZ 
the State should give Zaiut to every one who needs " at 
should be left to an Individual's own eonsciuee to refuse Zakat 
if he believes himself to be a Hashmi. . * 

26. When the Zakat revenue has been collected ;« 
Exchequer, the Slat8 

mstituaou. It can also eetabli* iummkm to carry out the 


work under various heads of expenditure. 

m Pf°P 1e wh0 °« d 2-k»t permanently or temporarily 

may be g.ven allowances on a permanent or temporary bLTia „ 
the case may be. ' as 

28. The conaoution of the head of expense 4< U, j : . 

29. There is no illegality involved in advancing ,v~ >j 
..e loan, without any time from lhe z , k , t n^T^.^ 
under the ^ c.rcum.t.nce, i, wold be .dvis.We in 1, o make „ allocation from the State Exchequer f„ Z 
Mtenston ofloans to the neodv persons 

Zav. 3 , 0 co » T""' cirMn » l " nc » H h «Uy fir that the 
■n need of the »mc area. Once duriag the period of Hadrat 

f»o). ° '" reUm ,0 tK ** flMmw <"- 

of Z^T™ 'a"*" ° f " ^ MphH balance, 

of Zakat from other areas, where they art Jets needed mav bo 

channelled to affected ,r„ 5 . m the event of . catastrophe 

SThT2 '.M 0 " 1 ^ """" rie! - lhe "*"«>=* of Zaka, may 

aiso De sent there for humanitarian reasons and Tor reconriu„„ 

he hcu of the affected people. 0 u. car. .hould Verted boundary, be it District, Division or Pro ! 
vnce. The administrative uoit from tBe DoiBt of vie „ 
country -.Id be a P r „v, BC e. The unit, of the Province • Ll 
be D,v,„ons and that of the Division,, the Districts. 

debt, he ^ of * ^e (he 

SS£ Toe wit "'A "1" c< " ,5,itu "• "» lhirf oa £ 
abim'ie? „ n ^ *«*»r,in, the above-m^ned three 

hab.!itl«, w,H be dittributed among his inheritor.. The rWr! 

mm. Whether he has willed ,« or not. the Zrtca, due f torn Um 

bcomomic mttx Of HUM 

mult bo paid out of his legacy. <Ata, Zuhri, Qatada, Imam 
Malik, Imam Shaffl'i, Imam Mohammed, Ishaque bin Rawaih 
and Abu Ttaaur nearly agree with this opiaion. Some jurists have 
suggested that Zakat should be paid only if the deceased has so 
directed in hi* will, otherwise not. But in my view this opiaion 
should apply only to *M J> ' Invisible wealth, for it is possible 
that the deceased had paid Zakat on this part of his wealth 
in his lifetime without anyone knowing about it. But in regard 
to 9ji& Jlj-i the visible wealth, if the administration of Zakat is 
in the hands of the Government^ the existence of such a pos 
Ability is eliminated. Hence the arrears of Zakat shall be 
counted as a debt on the deceased. The first charge on hi* 
legacy will be the debts he owes to individuals and the nent 
liability the debts he ow=s to God and community. 

32. Three methods may be adopted to prevent the evasion 
of Zakat : 

Firstly, Stale Administration should be in the hands of 
'persona of character and integrity who shun bribes and conduct 
the business of collection and distribution of Zakat without 
partiality or dishonesty. They should not allocate a major 
portion of the Zakat revenue to the account of their own salaries 
and allowances. 

The integrity of collectors will inspire confidence among 
the public that theit Zakat will be collected in a fair manner and 
will be spent on lawful heads. Hence the public will not resort * 
to evasion of Zakat. 

Secondly, Social morality should be reformed and the 
character of the people should be built on the foundations of Love 
and Fear of God. The duties of the Government should not 
cease with administration and defence of Lhc country but should 
extend to the moral training of the citizens. 

Thirdly, the common and all imaginable forms of evasion of 
Zakat should be curbed by legislation. For instance a person 
who transfers a sizable amount of hts assessable wealth to a near 
relation before the end of the year should be prosecuted and 
the onus of proof that he has not transferred the wealth with 

TUB MATURE Of ZAKAT aku jts jluus 


Lhc intention of evading Zakat should He on him. 

33. In my view, the collection and distribution of Zakat 
should be a provincial subject, 2nd the centre should have an 
over-riding power to allocate the surplus Zakat balance of one 
province to those provinces where the Zakat revenue is small or 
Falls short of the extraordinary local need. 

Further, the centre should have the power to requisition a 
portion of the provincial Zakat revenues for the purpose of 
establishing departments or financing projects related to service 
m the way of Allah' at heme 01 abroad, and to send help to 
the victims of catastrophes in foreign countries. 

34. In my opinion there is no need to create a separate 
department for the collection of Zakat. Colleciion of Zakat 
from various lectors may be assigned to appropriate departments 
which are already collecting other taxes in the same sector. For 
instance collection of Zakat on Agricultural produce and Cattle 
wealth may bo assigned to the Revenue Department. Zakat on 
trade goods should he collctced by the Income Tax Department. 
Similarly Zakat from manufacturing units may be realised by 
the Excise Department and soon. Tbe maintenance of Zakai 
revenue should be the responsibility of the Government Treasury 
and its accounts should be prepared by the Accountant-General's 

If the Zakat it made a Provincial subject as we have 
suggested and its collection has to be assigned to a department 
directly under tbc charge of the Central Gnverament, then, by 
mutual agreement, the expenses of that department insofar as 
they are incurred in connection with the collection of Zakat 
may be charged on the Provincial account. However, there 
should be a separate Department for the distribution and 
expenditure of Zakat under the prescribed beads. The charge of 
this department should be given to a Minister who already holds 
the portfolio of Auqaf and Religious Affairs. 

35. It should always be clearly realiied that Zakat is not a 
"Tax", but an act of "financial worship and submission to Allah *• 
There w a world of difference between "Tax" and "Worship" 


economic system of islam 

in terms of bas.c concept and mora) spirit. If the functionaries 
of Government and the Zakat payers take Zakat k T*W 
and „ot as -an act of worship", the moral and spiritual benefits 
which a* the real object of Zakat will go by the board and (he 
collective welfare will suffer a serious setback. 

The collection and distribution of Zakat under the aegis of 
Government does not make it a government tax. In f act the 
management of thi, financial worship has been assigned to the 
Government for the ptcme reason (hat it is the responsibility 
of an Islamic State to regulate and establish all forms of 
coJlecuve worship among (he Muslims. The establishment of 
the system of Salat and the supervision and arrangements for 
HaiJ are just as important duties of the Islamic State as the 
collection and distribution of Zakat. 

36. A rule has been described in Hadith : 

ZakeV'*" ° thef tOC 00 The WCallh of * P*" 00 besid«a 

la the presence of this guideline the question whether an 
Islamic Government can levy other taxes beside* Zakat becomes 
utterly irrelevant. The prescription of Heads of Expen- 
diture of Zakat by the Holy Qu/an clearly implies th«7he 
Government can impose taxes to meet expenses under heads other 
than those of Zakat Further, the Holy Quran also ordains ; 

"They enquire from you: What should we spend. Sav 
AJw." ' ' 


The word Afw is a synonym of 'Economic Surplus'. Afw 
therefore, orovides clear scope for taction besides Zakat. More- 
over, precedents exist of the levying of taxes in addition to Zakat 
during the period of the right-guided caliphs (Allah be pleased 

F °- inSlaace ' duty Ievied on im P° rts ™ line 
of HadratUmar (Allah be p^d with him) and it was not 

credited to the Zakat account, but to (the genera] revenues 

of the Government). Then there is no injunction in the Hadith 


from which U may be inferred that .he Goveromenc is debarred 
from chtfmog taxa for public expeoses. aod the ni!e is that what 

Warn with the e*cept,on of an obscure person Dohak bin 
Muxahim, has ever held that ; 

"The Zakat has abolished all other right* on wealth." 

This opinion of Zakat has not been accepted by any notable 
Wist. ^ tfl-MaMta U tbn Hazm, Vol. 2. p. 15ft) 

37. In the opening period of Muslim History, stale collectors 
used lo go about and charge Zakal on the Visible wealth at the 
spot. There were no separate treasuries to collect Zakat. All the 
"venues of Zakal went to the Public exchequer of the Govern- 
men! though the account of Zakat wet maintained separately 
The function of distributing the Zakat was performed by the 

WTO Govern, K r» anl « wh u dUdwgrt du.i« of ol hcr „ ature 
for Ihe disi„bu(ion of Z.kst io tb.l ported. But .h Me 

Prob , en , , wh --- h ™ ;r;,= in z ,r 

manner as suits our present eruditions and needs. 

I am not aware whether any present Muslim State has set 
up^y regular department fur the coition and distnbutL of 

10 the function of and distributing 

the Zakat shou M be performed by the Islamic Government it«if 
39. The Salary, Grades, Allowances, Pension R u i„ and 
other term, of Service in the Zakat Depa.temcnt should not be 
different from ^ those of other public Servian However, the 
Government should radically transform its policy and procedure 
with regard to remuneration of all Government employees'. 

lfl *l e f lin * bat*«« 'he income, and' allow 

ancea of h,gberaud lower cadxes arc allowed to coatiouc, 1 «, 
afraid the ^collection and distribution of Zakat will not be carried 
out on right lines. 


Economic *mtm of kl\m 


Qnestioo. Talking about Zakat some ore said that its rate 
can be altered to suit conditions at a particular time. The Holy 
Prophet (peace be on bim) had considered 2J% rate as suitable for 
his own time. The modern Islamic State can increase or decrease 
this rale according u> the prevailing conditions. He argued that 
the Holy Quran often discusses the subject of Zakat, yet rrowheie 
mentions the rate of Zakat. Had a certain rate of Zakat been 
mandatory, it would have been revealed. 

On the other hind, my assertion was that the Holy Prophet's 
(peace be on biro) decrees are unalterable and valid for all 
times. As for my interlocuter's claim, I argued that the next 
day he might also assert that the number and mode of prayers 
might also be changed in keeping with the demands of time and 
circumstances. This would reduce the injunctions of the Holy 
Prophet (peace be on him) to mockery. 

The second point that I made was that in order to meet 
further liabilities the Islamic State can levy additional taxes on 
the authority ofthe Haditb : 

There are other rights too on the wealth of a person 
besides Zakat. 

This same Hadith also contains implied proof of the per- 
manent validity of the rate of Zakat. If the rate of Zakat could 
be modified, why this Hadith ? Yet my interlocutor insists on 
the truth of his claim. Kindly favour us with an explanation 
of this point. 

Answer. Your argument Concerning Zakat is absolutely 
correct. We are not authorised to amend the limitsor rates prescrib- 
ed by the Bearer of Snariah. (peace be o.i him) If this door is 
opened, not only will the limit of liability and rate of Zakat will 
be affected but an endless process of amendment and abrogation, 
will start in connection with several matters including' Salaf, 

J . Adapted from Volume4 of Jtotaii-a-MatafL 

tub NAitmu or ZAKAT and ITS kvm } 65 

Fasting, Hajj, Nlkab. Divorce and Inheritance. Further, if this 
Itberty were granted, the equilibrium and balance created by 
toe Bearer or SHaxiah (peace' be on him) between individual and 
joaety for JU ,l ends will beupset. A conflict wiU arise between 
the udmdud wd loocty. The individual would press for an 
amendment » liability and rate which wits his interests whereas 
the society would want to serve iu own interest. It may easily 

hmitoflmb.h yaad.ocre^agtherateis p^sed, the affected 
individuals will not pay Zakat with an open heart, which is the 
very essence or worship. They will consider it an extortion 
like taxes and'a vicious circle of Tax evaiion will readily start- 

The present state of every one submitting willingly to the 
order of Allah and His Apcaile {peace be on him) and p a yi„ g 
Zftkat voluntarily aa an act of worship cannot last if the Parlia- 
ment ii empowered to pa** legislation on the limit of liability 
and the rate ot Zalcat according to the whims of the majority of 
its members. 




Quito! : Tie problem of Zakat on a partnership busing 
.. the Xompaoy share; u beyond my comprehension. The share 

mean. ;,: " Xerd> * ? i(te of P^- J « by 

"WW or th* document that a share-boldcx becomes owner of a 
proportionate value or the goods and properties or a company 
The fwn, ,o be considered, however, is what is the extent and 
type of the proper,^ held by a company? IT the property held 
by the company constats cr buildings, land, and machinery, then 
he tock-holaer being only a sharer in these properties is not 
^able to Zakat, for according to rule stated by you, these pro- 

f" ™ '" mpl ftcB > Z '^'- No doubt the share of the 
stock-holder bears value, yet it ia a part or the entire assets which 

then ahould the share or a stock-holdcr be liable to Zakat ? 
AM *"' ,haw -'" 3W «. «»* value of whose share in a 

However the Zakat ihall Dot be levied on a shareholder in- 
dtvidually. Zakat on , b , SBi « value of ,„ paitn „ s 

.ct,d,„°, I'T 5* Ct, " ged c "»«"vely Trom the company 

loud \ L> IT . k * p " licu '" bu, " , "» wa " '«» »» .4 

would ™. "" I •"" • d "" ° f Part-nnip. this d«d 

proof el it. Tic . Bc |j tl u, , jolnt-nock conp.n, »„j, h ^ * 
mtrL'Dd ahflje holder* th* . uum 

i h p of . penoo :o th. o»«id,ip rigbu of • bii^o.*. i tt c.pSiiS 

nihiafomerihip, 0,i 
"Mutt* u not jni * eoBCiH ii it ••olid, naUrUI rut. 


and furniture of a Company shall be exempted from the assess- 
ment of Zakat. Zakat will be levied on the remaining assets of 
company consisting of its trade goods, and the amount of its 
capital at the close of a yea*. If the nature of a company's 
business cannot be determined in this" way. the Zakat shall be 
levied after assessing its ftnaucial position on the basis of its 
annual income. 

Question. In your writings, I have seen so far on the subject 
□f Zakat on commercial shares, you seem to presume thar 
an Islamic State or at Irast o central organization for the 
collection of Zakat is In vogue and that the only problem, to be 
considered is at what rate and from whom the Zakat will be 
collected. What rule should be followed with regard to Zakat 
on shares until a central organization of Zakat ii established ? 
Many people to-day hold shares in commercial concerns. At 
what rare should they pay Zakat on these shares ? 

Considering my shares as cash in hand 1 made up my mind 
to pay 2,% Zakat on their value. 

But i found, however, that the entire annual income on 
these shares after deduction of taxes will go into Zakat. Some 
shares yield such a small dividend that the Zakat on them has 
to be paid from one's own pocket. Such a state or affairs Is 
highly incouvinciog. 

Anawer. The rule is that for computation of Zakat on 
commerce share,, the share value shall not be considered 
as cash in hand. Zakat on shares shall be charged accord- 
ing in the rule followed in lhe ^ of Irade rf 

that is when a year has elapsed after the commencement of 
business an assessment should be made or the stock, its value 
and cash in hand. Then Zakat at the rate of 2 1% should be 
pa*d on the total value of stock and c«h -in hand. In accord- 
ance with this rule the market value of your shares'sn one or 
more companies shall be computed. The fact that a man has 
sold his rust share and purchased a second one several limes 
during a year h immaterial. The year shall be counted from 
the date on wh,ch you pjichated > OD r first share and at the end 


ECGW«C ItfTlU o* 

of the year Zakat at too rate of 1/40 shall be levied on the sum 
total of the market value of Aires and cjjh la hud. As regards 
your predicament that after deduction of taxes your income 
from shares Is so meagre thai the whole of it is likely 10 go into 

t il l 1" ? PUUat - ™* h ■ I-" 1 * « must p.y 
for living under Govemmenti who nerer consider the paint of 
Zakat when imposing taxes. 

We must endure this punishment as long as we do not 
change the syjtcm of Government under which we are living to- 

Q.estieo. Your writings on the subject of Zakat on com- 
metcial share, sr. before me. A, a rule, the Zakat on iuC 
men. m a partnership business should be l«vicd only on™ Hence 
according to your view if the combed Zaka, of all .hare"* 
charged from the company, then a. my opinion Zakat shouM no 
be charged on individual shares. Again while levying Za^ 
company Use e»emption of those share-holders whose ,h„„ f.n 
Mow the limit of liability or who have held rTto ™ ™ 
than a year I. also questionable. More often than not h i 
difficult to ascertain whether a shareholder wh„„, ,„ ' 
company flto below the Umlt ,£ llabllit? o7 
otherwise liable to Zakator not. ' 

Another aspect of this problem Is also noteworthy. The 
economic effects of charging Zakat no individual shares »„! 
levying Zakaj on the collective share, of the company would 
completely diltaen.. I, m „ poK.bfe f„ the oom » p * 
the amount of annual Z.ka, in the cost account Zpolt 
ttonately mcrease the price of Its goods, becaute It i. seldom 
feasible to pay the full amount of Zakat out of the profit or to 
pay the dmdends to shareholder. after meeting the LabUity If 

such effect oq prices. ~ ■ uo 

At another point you have expressed the opinion that the 
tbmgs which are hired out are & 0 -\ iahte ' to 

opinion it comet it should apply i 0 the valoe of tQxi-c 8 hj 
trucks and buses hired out Tor traaipon 1 


Similarly a powu who owns several houses and shops and 
Jcu them out on test ihould be liable to 2f% Zakat on the 
total value or bis property. 3ut I doubt the liability of Zak.t 
in both these cases for two reasons. Firstly because since the 
time of earlier scholars till to-day I have not cone across an 
opinion or a practical ample that Zakat h to be charged on, 
tnc total value of rented houses. 

The second reason is that the argument which you derive 
from the tradition of Laith bin Saad in Kto^Anmil, p. 576 
does not seem to lit in here. Camels an liable to Zak.t as 
camels and not as things hired-out. 

T hope you will resolve this difficulty by throwing 50nie 
more light on the problem. 

Answer. The article on Zakat published in the Taejuman 
of November 1950 was an answer to the Que* I ion ml re issued bv 
the Government, in this answer it was presumed that ZaJcat 
shall be charged from the companies fay the Government The 
answer to a question in tho Tarjumm of Jnl y 1952 0Med 
on the supposition that the company itself will not pay tQC 
Zakat. bet that Zakat shall be paid by the indlvidu.l share- 
holders Heuse read the two answm keeping the different 
suppositions In mind. 

If the company pays Zakat on fts business a* a whole there 
is no question of inidvldual share-holders paying the Zakat 
separately on their shares. However it » indeed difficult for a 
company to ascertain in the case or every shareholder whether 
hois Kable to Zakat in his independent capacity or not. It i* 
therefore, the responsibility of, such shareholder to inform the" 
company thaL their capacity fails below the limit or liability so 
that their shares may be exempted from Zakat. 

IX the collection of Zakat is under Government management 
then the fact that a company has added Zakat to its cost ^ 
and has consequently raised the prices of its products cannot be 
concealed from the official collector. This irre«lari(v can be 
easily stamped out by the Government. Xm ** im * Can * 

But in the absence of Slate-Management of Zakat, only that 


company wit! volnntiriJy pay Zakat whose director $ are inspired 
by a sense of religions duty, Such people cannot be expected 
to give Zakat with one hand and evolve tactics to take it back 
with tha other, 

Suppose they indulge io snch a practice, they will have to 
pay an increased amount of Zakat the following year. If they 
again raise price, their liability of Zakat will alio rise. This 
process wrtl repeal itseir till a stage will be reached when it will 
become impossible for them to puih Bp the price line. 

The note on things for bin was brief. Hence the subject 
could not be made clear, fcly vlew-point is that the valne of 
the business of those who hire out furniture, motor can etc 
should be assessed on the basis of their profit. This does not 
mean thai Zakat should be charged on the value of furniture or 
motor cars etc which they hire out, for these are the instruments 
ofthelf business and there is no Zakat on the value of the 
means or production. 

What I mean to say is that the value of a business should 

be cVtennined by the extent of its profit. About the booses 

which are rented out, I hesitate to express any opinion on the 

ground that I did not find any ruling; from the jurists of the 

earlier days of Wans in favour of charging Zakat oa the houses 

°? °S. rent 700 re ** OQ far ,hc exemption from Zakat 
J-l^ll Jtfl (the working camel.) is the same as I have mentioned 

above I.e. the instruments and animals .by means or which a man 

works are exempt from Zakat. For instance, Zakat of cattle wtU 

not be charged on ploughing own or beasts or burden. Similarly 

cattle in the Dairy Farms are not liable to Zakat. The re awn is 

that, the Zakat of all these animals is included in the Zakat on 

tbecommodity produced by their labour. The camels which are 

hired out also fall under-the definition of "means of producing 

wealth/ 1 Hence they should also be exempt from the Zakat 

prescribed for cattle, nor should their value b: subject to Zakat, 

The Zakat should be leveed cm the v a | U e of this hiring business. 

I- iTarJiinuim-at-Qur*lt, febraixy. 1KJL 




Quest km. "Two men eater iolo * business partnership. 
The first partner Invests both his money and labour in the 
business. The second partner only contributes bis labour. 

The profit, it is agreed, will be divided into three poctionj, 
ouc portion going to capital and one each to the partners. Two 
questions arise regarding the Zakat on such type of business, 
(al If the Zakat is paid collectively from the business 
capital, (be second partner complains that the capital 
is owned by the first partoer , who earns an additional 
portion of profit on it. Hence the Zakat on capital 
should be paid only by its owner. Is toil objection of 
the first partner valid ? 
(b) The possibility or profit ot loss is ever present in 
business. Zakat on the ether hand ii concerned oot 
with profit or loss, but with capital. Btcq if the 
business suffers loss, the Zakat has to be paid on the 
capital in hand. Now if Zakat is paid eves in the 
event or loss, the Zakat liibi'ity of the second partner 

wilt be paid out of bis one-third portion of the profit 
In the following year. Thii will be in addition to his 

Zakat liability of this year Under this «tuation, the 
Zakat or the second partner no longer remains Zakat 
but becomes a tan On him inasmuch as he has CO meet 
one portion of the capitalist's liability of Zakat. 

Answer {■) Zakat is not levied the capital with which a 
business \s started, but on the value of the total assets. 
The correct procedute is to pay Zakat oa the total assets 
first, and then dlicribure the profit among shareholders 
according to the ratio agreed upon. 

(b) The role for u-de goois is that if the value of certain 
mercantile goods exceeds the limit of liability the 
Zakat should be paid on them- Now the man the 

1. Aifipied from Tmrivm-Ml-QMm. Jjonaty |9SD-£Mrw-. 


baais of whose partnerabip ii bfc labour, has participat- 
ed to some client in creating the value of bosirwu. 
Tbh Value has not been created by tfce Initlil capital 
alone. Hence two pardons of the Zaktt oa this 
buiiaeu should be paid by tbe capitalist and one, 
portion by the partner whose ihare is bated on hii 




Questioa. AU book! on Fiqb mention that tbo limit of 
liability for Zakat on ailver if 100 Dirhama (or 52± Tolas) and 
ibal on gold it it 20 Dinar (or 7 T Tolai). The UJcma an of the 
opinion that when a person pos*e»se> both gold and silver and 
ihe value of each falla below the limit or liability for Zakat, then 
the value or sold should ba reckoned on the basis of the value 
of silver or vice ytrsa and that way will be preferred In which the 
combined total value of both is greater. But they also state 
that ir a man possesses only silver, then the basil of reckoning 
shall be silver and if he possesses gold only, the basis of reckon- 
ing shall be gold. 

On ihii ground it b;corac* obligatory for a man who posses- 
ses Rs. 60h ^ pay Zakat, but the man having 6 Tolas of gold 
is exempt, evejs though be possesses wealth to the amount of 
Rs. 500f according to the present rate of gold. Nevertheless 
the decree* of the Ulcma make it obligatory for (he Conner to 
pay Zakat and acquit the Utter from ihU liability. J| it not odd 
to levy Zakat on a man who poinsies a l««r amount of wealth 
and exempt the One who baa more. 

According to my own reckoning the ratio between tbo values 
of gold and ailver in the past was not what ft is to-day. At 
present the ratio ia 1 : 75 or I : 80, but in the time of (be Holy 
Prophet (peace and blessings of Allah be on him) the ratio was 
1 : 7. The prescription of Zakat has been based on the value of 
a thing, and foe \yS (Metais), one hundred and forty 
Mllhaals of silver have been fixed as the basic limit of liability 
for Zakat. The Holy Prophet (peace and blessing" of Allah be 
on b|m> had mentioned thia quantity of silver while fixing the 
limit of liability for Zakat. The liability *as fixed at this level . 
beauss at that time the value of 140 Mithqals of silver was 
equal to the value of 20 Mithqala 74 Toiaa) of gold. But this 
does nor mean that the limit of liability for Zakat in the case of 
gold should remain fiaed at 7$ Tolas for all t imer t o come- Rather 

I. Adiotcd from Tarfuman-mMfivm.JwAM-mor. 


that wright of gold be the JimLt of liability which ia equal to 521 
Tolas of silver. That is to My anyone who bas gold should 
asaesls its price. If the price of gold in his possession equals or 
exceed* the price of 524 Tolas of silver, then he should pay 
Zakatonir, My opinion is corroborated neither by any tent 
id the Book* of Fiqh nor are the contemporary Ulema prepared 
to accept it. Hence I facie conviction in my owe opinion, 
T shall however be satisfied by aoy view in this ra alter which you 
regard as sound- 

Answer. Your opinion is correct to the extent that the 
ratio between ihe values of silver and (old [a the time of the 
Holy Prophet ipe*cc be on him) was, the same as is manifest 
from Ihe limit of liability, that is 52* Tolas or silver-7* Tolas 
of gold. 

But 1 do not accept your view that sjene a wide difference 
in the ratio has now come about, hence ibe limit of liability of 
Zakat on gold should be determined on the basis of the value of 
silver. 1 append the following two reasons for differing with 
your view : 

J. It is difficult to deeeimiot whether the basil of compu- 
tation should be gold or silver 7 Should the limit of 
liability on gold be raised or lowered according to the 
price of silver or rict wraw ? vVbicbever of the two U 
regarded as the basis of computation or th: basic stand- 
ard, it would be contrary to Ihe dictate of Shariah, for 
Ihe bearer of the Shariah (peace be on him) bas issued 
separate and permanent orders about the two and has 
given no express or implied indication f om which it 
may be inferred that the prescription of either trie gold 
or the silver as the basis of computation or the basic 
standard for the other was in his mind. 

2. 4)jJ.UJ ^iol i.e. to the benefit of the poor, is not in 1 
itself an absolute or established basis which may justify 
amendment of an express order of the bearer of the 

1. Adse-ictf from To'f*a t *r*t'Q*wt. December, l f5l -£rS»r. 


3. Alleration in the ratio fcjtwern (he priws of gold and 
sliver is b recurrent feature. 'If no separate limit of 
liability i$ fixed for each and the limit of liability on 
one of these metals is made conditional on the fluctua- 
ting price of otter metal, then because of the recur- 
rent up» and downs in their prices, no order of Shamh 
will hold permanent validity. Moreover, the public 
will experience practical difficulties in carrying out 
tlac injunction. 

4. The difficulty mentioned by you in the case of gold anu 
sliver is equally relevaat (a toe case of foats, camels, 
cows, buffaloes and horses. The ratio between their 
prices undergo** vast fluctuations in different ages 
and lands. In their case it is also bard to determine 
as to which animals' price should be taken as the 
basic standard to iicii the limit or liability on the 
other animals. 

For the above reasons, it is better to maintain the fixation 
of Zakac liability oa (he quantity or number of thing* which 
was determined by the bearer of Shariab (ffan and bleiaW of 
Allan he on him) . * 



QiMlfOB. Would it bo justified in this agt of liberalism 
to fore* the wealthy to pay Zakat for the- benefit of tfce 
poo- especially when the former elm. besides other uses, p ay , 
IncomcTix al» ? 

Answer, la respect of Zakat, the first point to be boroc in 
mind 11 that it U not a tax, but aa act of worship en J an article 
of faith .0 Mam. juit a* Prayer. Fasting and Pilgrimage. 
Anyone who studies the Quraa attentively can, notice thai the 
Book generally mentions Satat and Zakat together nod regard! 
Zakat as .n article of the Divim Cod: which each successive 
Apostle <j*ac« be on hirn) proclaimed in Us Hence to 

consider aod deal with Zsfcat at a taa it the flrsl haijc fallacy 
Jut as after exacting official and ether service* fremiti employees' 
an isfante QoTernnir at cannot exempt them from offering Snlnj 
oil the ground that they have already performed their public 
duty, so it cannot jay after levyinj taxes that the citliens are 
exempt from the payment of Zakat because they hate already 
paid such and such taxes. The Islaaaio Oomnmc.u must 10 
adjust its working houri that luftiocUooaries are able to offer 
their prayers in time. Similarly it must introduce suitable 
amendments in its system of taxation in make room for the 
oolfecrion and distribution of Zakat. Mortuvsr It must also 
be understood that none of the current taxes is levied by the 
Government for those object* or h spent b, it In those rorrai 

with Zakat. Hence to confuss Zakat with other civil -taxes is 
not correct by any means. 

I. Adapted (torn Tarjumt+ml-Q*,**, 

tMI NMUbQ ct Z&KaT ANt> m *UtBS 27* 




Qeestbu. U it justified in Warn to impose Income-Tax 
along with levying Zakat? 

Answer. Yes. Both are justified in an Islamic State. The 
expenditure of Zakat ii fixed, is mentioned in Surah Taubah of 
the Holy Quran. SimtJary tbe limit of liability and the tale of 
Zakat was fi«d by in; Holy prnphet (peace and oJessingi or 
Allah be on him). Hence any amendment or abrogation in this 
respect would be illegal. Obvinmly then, if the State needs 
finance* to mo?t other responsibilities, it ia Tree to seek monetary 
assi&Iance from the cili«n». If the tending of thia assistance il 
made compulioiy it is a tax ; if it ii voluniary. It is a donation ; 
if the Government promises t.\ return it, it ia a loan. 

Zakat and tlieie other exact ioni are neither interchangeable 

nor can abrogate each other. 

This Is the answer in principle to the above quealion. But 
at the same time I aisure you that if a truly Islamic Government 
is cBtabliahed in our country and iit administration ie run 
honestly there would be ao need to impose the multifarious taxci 
which are current today. You are fully aware of the corroptioD 
and irregularities committed in the payment and recovery or taws. 
On the one hand hardly 10% or the tax revenue is spent for the 
purpose? rot which tbe tax was levied. On the other hand, evasion 
of tax has become a eoraraon habit. If the system of Government 
is reformed, one-fourth of the present taxation will suffice and the 
benefit accruing from it would be manifold. 

i. AdiptBd from T*flvM*a-4.Q*TaH. S*p(emt>«. 19*4 XKtor. 

Problems of Labour and 

their Solution 1 

The hardships and problems confronting lhc industrial 
labour and farm worker; to-day are lhc direct result of a faulty 
economic system, which in itself is merely a component of . fl 
corrupt order of lift Unless the entire system of life it replaced 
and in consequence che economic system is improved, the 
present problem? of the working class cannot be fully resolved. 
Causes of ibe Malaise 

The present economic system of our country is not entirely 
of the British Raj. The evils of this system were evident even 
before the advent or the British rule. Sbah WaliulUb'i writings 
be« ample evidsnce that even in his days the people were 
crying under (he burden of an oppressive economic system. 
The British augmented the existing wrongs with inmimet able new 
ones, and imposed on the country a system far worse than the 
previous one. The multiplication of wrongs in the British period 
was firsrjy due to the fjet that the rulers were protagonists of; a 
mateiiaJistic civilization and secondly, it was an age in which 
tawtZ'fairt Capitalism Was at its zenith. Moreover, the British 
had imperialistic designs and their object was co exploit the local 
population to scive their own national interests. These three 
clermnts made ibe system tbey imposed on the sub-continent a 
rule of tyranny. Later we got rid of their bondage, butrven after 
their departure no signs uf any change in the existing system have 

I. This extract haa been takea from the speech delivered by the 
vceerable auiAor a: tbe Convention of Lebour Welfare Commmet, Pakhua 
held aa [Jib May, 1957. —teSttor. 


appeared go far, The reason it that oar political revolution ii 
oottheoul-comeof aoys rugglefar any moral or intellectual 
charge. It w« a fake revolution born out of a political conflict, 
iustaday before the proclamation, nobody had any working plan 
fcr the future. There was no clear conceptiou of any system 
of life to be adopted, and the nation as a whole had no 
clear cut programme to implement. Since Independence no evil 
haa waned, nay, evils have been waxing ever more. The edifice 
raised by the British on the pillars or Capitalism, Imperialism 
and Materialism standi erect even to-day. Raiher than 
dismantle this edifice, It is being further developed. Ever 
sioce the establishment of Pakistan, no need has been fell to alter 
or amend the laws enacted to protect that materialist system. 
The rules framed by the British to bolster their imperial power 
ate still in force ; the tamo administrative policy is being fol- 
lowed and the same educational system reigns in our society. 
Had our Independence been (be natural outcome of some mora! 
and ideological siruggle, we would bavc a clear cut plan before us 
for running the country; we would have prepared such a plan long 
before the attainment of Independence and would have started 
its imptementlon without a moment's delay after winning freedom 
But this never happened. The evils rampant in the period 
of our slavery have not the least decreased ; raiher the wrong, 
prevalent in the British period have increased manifold and ere 
thriving day by day. 

The Real Nerd 

Our real n;cd to-day is to change the cmire system of life. 
Unless this is done, no distress, no grievance, no wrong can be 
fully redressed. The real cure for the present ills is lh at the 
whole system wich alt its ideological and moral moor iocs should 
be trapped and in it5 l(Md snouid be COuSlructed a iyitCffl Qq 

such moral and ideological foundations which guarantee social 
justice. When this chan B e in the system of life is effected, 
equity and Ja «ice will > automatically established and [he 
problems and grievances of the working class removed In our 
view, the foundations of life which can guarantee real ioci,1 


■ juatioe can only be provided by Islam and it is the establishment 
of the ay&tem of Islam for which we strive. Different concept* of 
Islamic justice are being put forth from various quarters. Some 
advance one interpretation and some another^ Nevertheless, 
Cbe real source; of Islam, the Quran and the Sunn&h, are extant 
in their original form, and only that interpretation will be 
viable which can be authenticated with reference to both these 
sources. Ultimately it is only the public opinion in the Muslim 
society which will decide in favour of one interpretation or the 
other. Hence there is no cause for alarm at the difference in 
interpretation. Any democratic order which is built according 
to ihe dictates »f the Quran and Sunnah will, Qod willing, ensure 
equity and justice. 
Solution of Problems 

But until such a comprehensive and basic charge ii brought 
out in the system of life, wc have lo endeavour to establish justice 
to the utmost possible extent, to do the maximum for this amel- 
ioration of the lot of the working ctaai and to safeguard this class 
from becoming the tool of opportunist parties who may exploit 
their grievances to establish an ua-IsUmic system. 

Of ibese three objrctjves, the last merits some detailed ex- 
planation. The psychology of people differs from man to man 
Take the case of a man who it groaning with pain. One 
considers it most opportune moment to plunder the afflicted 
person, to make capital out of bis distress and pain and to 
exploit his suffering to bfs own advactage. 

Another one thinks that until full scale medical treatment is 
arranged for the patient, at least some sort of first-aid must be 
provided to him ;o relieve him cf his suffering as much as 
possible In regard to the working class, both these types of mental 
attitudes are at present in operation. This class is involved 
in severe hardships and the modero capitalistic system has 
entangled It in countless problems and difficulties. One party 
desires to exploit th« difficulties of this class for political ends. 
Their real objective is act to remove the hardships and redress 
the grievances of the working das* ; rather they try to augment 



thfrdifficuttios of the working clau ami ^*-v t« ki„„u 

IW» cla., .hould grow and the Nation raay be ezpfoitcd for 

and toe of Communis, through yioleot revolution. 
The system which they hold out ai Utopia of the workcrj 

«r.r y i- Hs " for tbe wori ""- " fac, - the «" 

of the working el,„ wilt begin the day on which. God forbid 
the Comraiin.rt S y, lcul comei into effect. The lot of the 
worker 1, no doubt bid to-day. but the mi cry he wilf !u ff f 
under the Con,m„„„, , w „ u unimaginabie. tLV ' u * n 

p ,X y Z tmaBds " u 'V hw " 4 oul *»»«"»« « 

ale th. oh . 7,'' ° U ' <" a ""™>- ««" « "P.°» or 

CoL t " ' f ° r """' eb*. ]o the 

Comoun-.t Paradu. ,i| , B „ e ,ve„ u „ ^ 0 . M ^ cl0 ,., .„ 

I T'; pri^li "' , rre11 "- ,h - ■» *^ — 

te ai^d ™ T P' 0 """"" *• "orke. wiil not 

tbe whole country whose service Ml u, rt ,i- ,taus " ia »" "i 

psopf< mu " ^^2.™ ~o 

«*. their p'roble^ ^« tSL"™^ t".''.^".^'"^ 
«« ,nto ,h, nklag ,„„ k wj|| ejpropri ^ <||j 

2*2 ecoNaHfc mfEM 6* 

and lands of the capitalists and feudalists and nationalize them 

under the Communist State whose workers and farm-tenants 

(hen all the citizens must become. This faction demands the 

right to strike for all the workers of the world, yet wherever a 

Communist State has come into being its first act has been to 

proscribe the workers' right to strike. This party wys to the 

"In the socialist system all causes of discontent which 
induce the workers to go on strike shall be eliminated." 

Y;t it is entirely out of question that where teat of millions 
of people work under the authority of a small clique of rulers, 
there should ari>e no cause for complaint. The question is if 
a complaint docs arise, do the workers have a right to form a 
union in ihe Communist Stale ? Can the workers 6nd free Press 
to ventilate their grievances 1 In fact, can a worker escape 
imprisonment for so much as uttering a word of complaint ? 
This is why we feel convinced thai the socialists are poised for 
perpetrating a greater tyranny than the one to which the 
capitalist and Ihe feudalist is subjecting the working pcoplg 
to-day and thai the socialists wish to iue the working class as 
fuel for (he furnace of Communist Revolution 
Principles of Reform 

In contrast to it our desire is ihat until such time at the 
Islamic system or social justice is established, endeavours should 
be made to ameliorate the problems of the depressed class to 
the maximum possible extent, and neither to exploit this class 
for political purposes ourselves, nor allow o.hersto do so. 

We do uut believe in class conflict. We intend to elimioate 
class conscious^ and class distinction. It is a wicked system 
which creates class divisions ,n a society. Metal corruption 
jtets up distinctions and injustice generates class consciousness 
The programme adopted by ihe Communists is to increase 
class consciousness as much as they can and bring about a 
coofrontatjon be nrfee a various classes in a society. They * 
disrupt tnc tyrannical sy stem of capitalism and feudal* 
replace »t with an even more atrocious Communist system. 

la Contrast to them we Joofc-opon huinan society as one 
organism. Just as various organs in a body have tbeir own 
separate place and function and there U no confiict for 

instance between mind and liver rwy the r»dy Uvea because- 

each' organ earr|« oat ita assigned usk as a member of a ceam. 

s«irty tbODld function iQ their own place according to (heir 
aWihy.eapactyand natural aptitude and extend sympatic 
aod hemane cooperauon to one mother. Thus Jet alon e class 
confllci, there shuuld not arise among them any sort of class 
consciousness or distinction. 3 

ree ft «iL d ? iPI, - tlial eVCTycDc ' *»PJoyer or M-orker, should ha, duties before hi. rights and look to their efficient 

will be eliminated and problems wilt cea«e to arise 

the ^'^Z kkto T m ^ l ! aninQt ° f m " * nd ™** 

which has overwhelmed him. If the -ethical man' in Individual. 

reform 7 ^ ^ ^ " f ° fm 111041,4 *'* tO 

;° n l h , C ^ D0,D1C 1 «»w country and guide both ifa_« 

employer and the worker along the right path. 

do nllHI £ ,hC ^toV™ '• * *>« hold your interest dew and 
on not wuh to lu.nyoursclvea, you should not give way lo (he 

S£»r" WCtkh ' " baDd0D «d p o! 

ocTn»» ^08«i«»nd pay the lauful rights of your worker,. 

expropriate all the economic advanuge, of the country, 
decent, but M them reecb , he masses .ho whose coilec- 
Uvt^utctt ^ cofkctxve endeavour is promoting this 

£ eel ^^p^^S — S 



equitably distributed among all the ittrtniments of production 
and all practice* forbidden by Islam arc abandoned, those 
anarchist movements can never gain a foot- bold which, if 
successful, would spell disaster for you- 

To the workers we say ; work out justly what are your law- 
ful rights and what ii the share or capital, the administrative and 
business exec olives and technologists in that wealth which is 
produced by a combination of their skill and your labour. 
Whatever movement you initiate for the sake of your rights must 
be based oa equity and you must never take tbat exaggerated 
view of your rigSt* which the protagonists of class war present 
before you. AH your endeavours to win lawful right* mast take 
a lawful course. In such a case it would be the duty of every 
righteous man to support your cause. 

We leek to introduce the following reforms* io the economic 
system of the country : 

1. Interest, speculation, gambling and ail other forms or 
gaining wealth which have been proscribed by the islamic 
SbarUb should be declared illegal and the people should 
be allowed to pursue onry lawful means of earning 
wealth. Moreover, all forbidden forms of spending 
wealth should be banned. It is only by these measures 
that capitalism can be rooted out without destroying 
free enterprise which is a sine qua non of democracy. 

2. The most iniquitous concentration of wealth which has 
taken place through unlawful and unjust means and due 
to the undeserved favours of an evil system should be 
eliminated by bringing the top capitalists to account 
according to Islamic principles and divesting them of 
all their UJict gains. 

3- To end the. inequalities in land-holding created by. a 
long-standing evil system, the following rule of Sharinh 
should be followed ; "Extraordinary measures which 

I. This is so extract from the rciolution acootcd by the working com- 

min Cfl of .be Jaaj»«M-(s!aari. it h reproduced hers btcsnts it b.4 hseci 
drafted t* ,bc authofi (£rflt0T) 


do not come in conflict with Islansjc prioolplct may be 
adopted to meet extraordinary situations." Ia view of 
the above mentioned rale ; 

(a) All old or oew Jmgiri which were graded by an unlaw- 
ful exercise of authority uDder any Government should 
he forthwith abolished for their ownership is invalid 
under toe Shariah Law. 

(b) In the case of old holdings, a ceiling (say one or two 
hundred acres) should be fixed and all Una: la excess of 
the natatory ceiling should be purchased from the 
owners at equitable rates. Such a ceiling may be 
enforced as a temporary measure in order to do away 
with old disparities. But no ceiling can be permanently 
kept in force, for it not only clashes with the Islamic 
Law of Inheritance but also comes Into conflict with 
several other laws of S Uriah 

(c) A regulation should be framed under which all lands, 
whether State property or secured through the above 
mentioned m cam or made cultivable by new barrages 
should be sold to laDdless farmers or owners whose* 
holdings fall below toe economic level, and the price 
should be recovered by easy instalments. The local 
people should be given pre-emplory right to purchase 
these lands. The procedure of allotting lands at low 
rates or as gift to influential people or officials should 
be abolished and all allotments previously made should 
be annulled. Moreover roe sale of land by auction 
should be disconiinued. 

(d) Islamic Law of Tenancy should be strictly enforced and 
all un-lslamic customs should be declared illegal so 
that no land holder can deal with his tenants in an 
unjust and oppressive manner. 

4- The current ratio of disparity bet ween salaries which 
weeds 1 : 10Q sfcjuW be reduced to I : 20 for the time 
being, and graduaJjy brought down to 1 ; 10. Further 
it *homd be ensured that no wage fall! below the sub- 



«sicnc= level at the prevalent prices. Uodw the present 
conditions thia Iev c * should be fixed at between Ri, )5u> 
to Rs. 200/. ptfmc^emanditjhouldbeperiodiciHy 
reviewed according" to fluctuation in price*. 1 

5- Low-paid employees should be given suitable facilities 
m bousing, medieil care and education of children.. 

6. All industrial workers fbould receive cash bonus in 
addition to the subsistence wage mentioned above. 
Trie workers should be made partners through the 
allotment of bonus shares, so as to give (hem a stake 
in the growth of their industrial unto *nd In order to 
make them shsre in the profits which their fcbour has 
helped to earn. 

The prc«nt Labour Laws should be replaced wjih such 
just Laws as are conducive to the ending of conflict and 
creation of real cooperation between capital and the 
labour-lawi which guarantee the legitimate tjgbia of 
the workers and establish an equitable piocedure for 
tbe adjudication of industrial disputes. 
!. State laws and admloi strati ve policies should be so 
modified and reformed as to eliminate tbe monopoly of 
a small privileged group over Commerce and industry 
and to associate a maiinium number of individuals as 
owners and proflt-sharert in both sectors. 
Moreover, all loop-holes in the laws and State policies 
which encourage profiteering, create artificial shortages 
and deny fruits of economic developmcut to the 
mas* s , should be plugged. 

Basic and key industries whoa- management by private 
sector is detrimental to public interest should be nation- 
alized The decision as to which industries should be 
taken under public control ties with a representative 
Assembly, elected by the free vote of the masse*, jtie 
Assembly must ensure, however, rhat nationalised 

- TbasesuwsMoaiwera nitfeii »« mliu of lWt . 



»OJU.BKi or i« 0 |.-m AVt> THG1R SOLUTfOH 287 

industries do oot rn prey «o bureaucratic malpractice, 

r b flL^ nv ", iiew iB, ° ,oiias coT,cwni iostead of 

profitable ventures. . 
The entire Bankicg and Insurance system, working in 
our country which, origiaaKy, is Ihe plan of Jewish 
Capitalists should be radically changed and a syatem 
based on the Islamic principle, of Mu^rba and mutual 
cD-pcration should replace it Without thl, basic 
rerorm the evils of Banking and Insurance cannot b* 
removed, even if these two sector* are taken under 
public control. 

To implement the Islamic .cheat of Sooiel Security the 
better of which has not been devised by any other 
system, an agency shoofd be established for the collec- 
tion and disbursement of Zakat. It is the only measure 

m.di«? U K 'I" 1 **! P ' 0Vlfio ° 0f fo °*. clothing, belter, 
medical help aad education to every ciiiwa. 

12. The six poin,, which Che Pakistan Democratic Move- 
ment un.nirnously adopted out of its S Po.nt Programme 
should*, put into effect to ciose .he disparity between 
East and West Pakistan.! 

It should, however, be clearly understood that Man's 
real and only problem is not econnmic, though this 
problem i. ineottricbly Naked with other problems of 
life. Until comprehensive refurm* accordipg to Islamic 
precepts and rules are effected in the moral, educa- 
tional, political, legal and administrative spheres ol 

rfta l lJL*2J' t " l ' t ******* **» H*s«ttd aianelWaf 
fcfflv-^tr ^ °*t J"^ lb# llW « Uimr « Iw b ' ^Mitasi Democratic 

Insurance and Schemes 

for its Reform 1 

Question. I feel confused uo tbc question of Insurance, and 
cannot decide as to whether contracting an Insurance Policy is 
lawful from the I&Umic view point. If tbe present form of 
Insurance business is unlawful, what amendments are needed 
to make it lawful- If under the present circumstances, we wind 
up thi* business, tbe people will he deprived of its many benefits. 
It ii a sort of universally established scheme and every nation 
has organized Insurance business oa a vast scale and is enjoying 
ii» benefits. We are still suffering from confusion and indecision 
on the issue. Will you please give me proper guidance ia tbe 
matter and oblige. 

Answer. According to Islamic Sbariab, there are three basic 
objections to Insurance busincn which make it unlawful. 

Firstly, a large part of ihe capital collected by Insurance 
companies as premiurr is invested by ibem in usurious business, 
Policy-holders thus automatically become sharers in this unlaw- 
ful business. 

. Secondly, the undertaking of the company (o pay the 
stipulated sum in the event of death, accident or loss is a sort of 
gamble or a game of chance 

Thirdly; the sum paid at the death of the Policy-holder is 
a bequest of the deceased according to Sbariah which should be 
distributed among hi* legal heirs- The company does not pay 
the sum to legal heirs, but to a person or persons whom the 
Policy-bolder had nominated his heirs. The correct position 
under Islamic Law it that no will can be made in favour of legal 


, * - — — P ' 

I. TttUchiptsreOQtaiostaalMrT.etfauther'a miners rosotpe tcadlat- 
questions. -W 


ihsuxaxc* and souus? so* m ujoiu 

The question as to how can the Insurance business be run 
od Islamic principles is not so easy to answer. A commission 
of expert!, wcH-vcwd in both I«lvnw La* and mechanism of 
the Insurant* business should loot into the whole i*sue and 
suggest measure* to bring this business la line with the principles 
of Shariah. Until (bis Is done we must at least feci guilty of 
doing sometoiug improper. Without this sense of guilt, any 
effort at reform become* Irrelevant. 

No doubt, the Inaurancc business hold* an important place 
in modern life and it being practised all over the world, but it 
is not enough to make an act legitimite or lawful. Nobody can 
claim that all that is going on in th= world is lawful or should 
be lawful because it is universally practised. It b our duly as a 
Muslim nation, to distinguish between right and wrong and 
insist to run OUT affairs on righl lines. 

Qaestion. Yon rightly suggest that basic reforms should 
*bi introduced into the insurance business. Bui you know this 
is a long and unremitting work. 

t have so Tar prevented my company fiom going into the 
Life Insurance buiinns, but now, aficr much consideration I 
have concluded that the evils of Life 1 nsuxance can be removed 
by adopting following measures : 

1. At the time of depositing the security with the Govrnsnent 
an advice may be given to the Company that instead of 
investing the premium* received in usurious business, 
it should invest the m 0)1 ey in some State enterprise or 
P.I.D.C- With some canvassing the Government, I 
think, will agree to this suggestion. Thus, partnership 
in usurious business may be avoided. 

2. The Company has the power to accept or reject any 
Policy proposal. We can insert a clause in ihe form 
of contract nnder which a Policy-holder can instruct 
the Company that at his death, the Company should 
divide the amc-wat of his Policy among his heirs 
according to Shariah. 

lp strict compliance with the injunctions of God and 



^ApojUetAll^bcpkaicdwithhi^itcafl also be 
Wd down that the application of a proposer who does 
not agree to abide by the Shariab in the division of his 
Policy amount, should b» rejected. In this way oaly 
those persons will be allowed to talc out Life Insurance 
Policy who submit to the rules prescribed by Shariah. 
3. To eliminate the dement of speculation the policy- 
holders Eball be persuaded to agree toft at their death 
only thai amount shall be distributed among their 
hn« as they had actually accumulated in their Policy 
account. It i, clear that though under the present 
circumstances the Insurance business is attended with 
maoy evils, it it not altogether Lacking in possibilities 
for doing good. 

Depressed by the thought of evil, i bad resolved to seft my 
Company some time ago. Later, however, I felt that some way 
must bo found to set an example for others tad to run the 
Insurance business within the bounds tfxed by Islam. Kindly 
favour me with your guidance. " y 
Answer. The proposals which you have now outlined for 
reforming the Insurance business will 1 hope remove the cause* 
of its prohibition. Ia my view the least measures that should 
be adopted for legitimising this business are these : 

I. The Government should be persuaded to invest the 
Company's security deposit on equity bash in some 
state or semi-autonomous industrial or commercial 
enterprise, and pay the Company, not a fixed but pro- 
portional pro6t. 

2. The Conpany should invest us other funds in such 
productive ventures as yield proportional profit rather 
than a fixed raie of interest. No portion ot the 
Company ■ capital should be invested in any usurious 
enterprise whatsoever. 

3. Life Policies should be issaed only to those persons who 

to abide by ihe following two rules : 
(a) At their death only the sum actually contributed by 


KJftiiViircMM 291 

tUm to tUtic PoJiey Account ifcall b* drtbumd to 

Iheir heirs. 

(b) Tfa>, mm ifa«]l be divided among all their heirs 
according to the Shariah. 

The sqjd contributed by those Folicy-aoldtv* who with 
to wo profit ihoutd wit), (heir content be Inserted on 
equ.ty buii in such bus inc.. concerns ai fcivo been 
out-lined in No. 2 •bore. 
1/ you succeed in introduce Lbeu four reform measure, 

not oiUywiU the business your own company be legitimised! 

but it will scire as a uaeful genetai guideline for others who 

wish to reform the Insurance sector. 

Price Control' 

Qnestlon. "This is aa age of controls. But the shopkeeper 
doei not get goods on control rates. For onward supply to his 
customers, the shopkeeper is forced to buy goods in the black 
market. Obviously ir he sells theio goods at control rate he 
will incur a loss. Hence he raises the price. Some people 
however, regard this as unfair and fraudulent business practice 
and the police also takes action against the "offenders." What 
does Shariah say in the matter. 

Anwar. Morally, the Government has no light to enforce 
Price Control until it can ensure the supply of goods at 
fixed rates. Without such arraogemcnt the enforcement of 
Price Control only strv« as indicator to the stockist to conceal 
their stocks and either to withhold them altogether or to 
dispose them in the black marker If a Government, which not 
ooly possesses a tbeoretical knowledge of this phenomenon but 
has also witnessed it in practice, enforces price control, without 
ensuring supplies on control rales, it has no moral right tn 
expect thai the consumers and the traders would adhere to its 
directive. It is now quite obvious thai the consumer or the 
retailer cannot proenre anything from the wholesaler on the rates 
fixed by the Government. If, however, the retailers buy 
anything in the black market they cannot sell it in th; open 
market at control rates. Under such circumstance*, if anybody 
buys in the black market in order to earn his living and to 
meet his consumer's demand he commits no offence, and a person 
who further sell s these commodities on rates other than the 

!. Adapted from Ttrfumait-ut-Qurut. July-OejoWr 1944— EtiHer. 


T w r eD KT drthK *°" ld be a,10th " "* of ly^y 
on the part or the Government, ' vr*auy 

,f.h Si rr il - i ' r !l" antWlhet0 ^' I » V<!be,QW, » outline 
of the UI»mic policy on Price Control 

fi |?S of theHoiyftophet (peace and bluing* 

of Allah be on him), the pnees wcat up in Medina. The 
cxtizen* petition** [he Prophet (peace be or, him) »o fix the 
prices, whereupon he observed: 

'« u-^ -uV 

; r»= -fid fall of price, i, in the hand of Allah (i.e. ,s 
object to natural la«»j md I intend lo go before Allah 

LnjuMi b 0e*'' , '' l<,,halnO ^ ° f lyr "° y ° r 

Ut« he (peec be oa him) would continually area, |„ flit 
aUdrewea. c^veriatiow aod interview, with people thati 

"The telle, of ueccuii.ea of life receive, wsteiuuica «d 
favour from Allah ; the boarder incuxi Hi s disfavor." 

"He who wnhholds the «o,k of gram fur forty days with 

^ITTVa cff ??- ai iflcreaic ifl ptices ' AiUh b " 

nothing to do with Mm and he is do mar of Allah." 
&i U^l 01 j 0> jbOll -I ^ *l ,£*JI -u-)f ^ 

-How wicked i* he who wuhhold* the ,tock of neceawry 
commodities. _ When the price* come down he grieve*; 
when they go up, he rejoiced 



'"He who has withheld grain for forty days, then even, if 
be jives away this grain in charity, ihe s in which be had been 
committing for forty days would not be wbed away." Io 
fciijwy the Holy Prophet (peace be on him) constantly p " 
ached and warned ag.j n « hoarding, till the soul, or the traders 
^cleansed and the hoarded stocks were brought to the open 

Such is the power of a ruler whose administration it based 
-OD principle, of "higher morality' . The Police, Courts Con 

l^ll^t ^ illlQC f »™ not the rcal-propi of Ms ruf He 
root* out evil from the very recessea of the heart and suul of 
men, reform, their motives, transforms their ideas aod outlook 
Changes Ihe scale of va] Uu , and in» pi rc. people to a voluntary" 
obedience of hit injunctions, which are based on positive mora! 

In contrast, the preicnt worldly rulers whose personal 
motive, are not unsullied, whose morals are corrupt, whose rule 
can find no other teg to stand except dictatorial repression 

wren ,uch ruler, confront the circumstance, such as 

prevailing to-day, they try to achieve their ends by reprewive 
measures and instead of reforming public morality they speed up 
the process of moral degeneration to its last extremity. 

Ke-codificat ( on of Economic 
Laws in Modern TinS? 

We must tamil that the iim« l 

, '\°"" Um b *> Ph.. ^? ch , 4 " 4ed - *■ "c^ a a oai 

«*»■. of ,h* wo , Jd P ^ y ^ »d ^o^ic 

ov,w, Lawj(10 ^ dc ; e t-r b v ,b o,, M ioas - ,heref< "« <" 

Qui" and Suroib U.haih ' e Muslin, j U n St , f . 

Matted in .he coolcu of , «"« «»xly of ,„ a[a " 
Hil«. Iraq. S yfi /, n 0 ;^ f OK ' aJ ^'turaJ CB „ iroomt ^ 1 ™ 

Shanal, 1o m " "»erp,eted the ^j., of 

oced lo be considerably Ju^td T h ' 0 '' F, ' , " , "-"fifty 

«*. of t:sr^^* n «- B Ti,"& 

'■ ^^^^ aed 




principles of Islam. Their object is io grab wealth by fair means 
or foul, while Islam stands for livelihood by lawful means. They 
, strive to earn millions and fail I iocs, without regard to lawful or 
unlawful means. Islam, however, demands earning by lawful 
means only, without usurping the rights of others, no matter he 
becomes a millionaire or not 

According to this group a man who ama*ses the largest 
amount of wealth, fiains control over the constantly expanding 
ecoDomic resources and bujs with them the maximum comfort, 
prestige, powet and influent, is rhe most successful irrespective 
of Lhe Fact thai he niigh< have attained this iuoccss by gross 
selfishness, oppression, ^idlous.icss, falsehood, decepiion, im- 
morality, trampling upon ibe rights of fellow men aud brazen- 
faced promotion of mischief, strife, wickedness and lewdness 
thus driving mankind to a -tate of material moisJ and spiritual 

According to islam successful is he who endeavours to earn 
his livelihood by truth, trust, honesty and scrupulous regard for 
the rrfihts of hit fillcw rr.t:i. If he becomes a millionaire by 
an enterprise of such character, it is a reward conferred by 
Cod upon him- But even if suet an enterprise enables him just 
to make both ends meet, to afford only tattered clothes and a 
thatched hut for »hcltxr, he is not the loser. This difference of 
approach towards fife leads ihn group towards pure capitalism, 
which is the antithesis of Islam. The concessions, allowances 
and permissions which thc> seek are never permissible in Islam, 
Stretch and strain he principles aud tenets of Islam as you will, 
yet it is beyond you to doduce any rule or regulation which is 
not the least envisaged in the framework of Islamic teachings 
and principle?. Heoee those who '*ish to follow the path of 
capitalism would b; well-advised to stop deceiving themselves and 
the world and clearly understand that they have no option but to 

1. The ttftrccce htfz i> to ir-up which lAtkt to declare Ibt mtlhudi 
of Capital.*: sytitto Ftwfui aod in conformity wiih Islam. Tl» posittoa of 
Communist minded sroup i* to tie contrary. The filial of tbeir iMDd* 
point hat been *tpott4 by tht Auifcsi 11 &*veral coimi 3a ita book. 


adopt (he economic and monetary rules and regulations current 
io Europe and America instead of these prescribed by Islam. 

As Tor those who are Muslims and iafend to follow Islam and 
have faith in the Quran and tbe precedent of the Holy Prophet 
(Peace be on him) and consider it necessary to follow them in their 
practical lire, they do not really need a modernised code of Laws 
to take advantage of iru institutions of capitalism, nor do they 
want Conversions in the Islamic Law to become business mag,atej, 
banker* or industrials. They need a code only to adapt their 
conduct to (rue Mamie norms in the present economic conditions 
:tnd and Commercial u flairs, so that they can avoid such 
business practices U arc repugnant lo Allah's Law. And whet.-, 
ill international transitions, they confront real difficulties, they 
should be able to of those cuneenion* which Mamie 
Shaitah might a!l>wj in such cases. For this puiposc, fresh 
codification of the law U do doubt necessary and the scholars 
of Islam are duty-bound to direct their energies l0 this (ask. 

Need for Ra-cDdiacatioa la Islamic Law 

Islamic Law it not so rigid or static that its. initial codifica- 
tion to suit a particular time aod place should remain valid fur 
all times to come without any change Those who 
entciluin such concept or hfamic Law are not only wrong, They 
have raihcr tailed to grasp trie (rue spirit of Law. The Islamic 
Shaiiah is based on reason and equity. The real objective of 
legislation is to regulate the affairs and relations of rhe people in 
such a manner us to 

(aj promote cooperation and sympathetic accord rathrr than 
coofliu and competition amoog them. 

(b) to set down their rights and duties on .in equitable and 
balanced scale. 

(c) to afford to every citizen full opportunity not otHy to> 
reatbe his own potential but also lo be helpful in the develop- 
ment of the faculties of others or at least not to create couflicl by 
resisting or blocking the growth and advancement of their 


Forth* parpc* out of Hi. Supreme- Knowledge of human 
nature M d the atrial world. He has issue d certaio decree, 

>n every spheroofl.fc, asd His Apostfc <p„« be on him, ha, 

priced beforz us * modet by complying with the* decree, 
id practical life. 

Though these decree* were issued at a particular time and 
underage situation and were implemented in a particular 
society, yet the wry words of tbeae decres and the way and 
mean* for their enWmeot by the Holy Prophet (peace and 
blessmgs of ANah be on him) reveal such wide-rangi^ and 
comprehensive priocipale, a* are equally effica'ciou, and work- 
able for the establuhment 0 faj us! ,ociety in ever epoch and 
under all condign,. Tb*,e principle, are the only part of 
is lam wh lch „ eternal and immutable. It is now the re.pons*. 
b.My of every generation of WuyroAtf*. (legists and Jurivs who 
have the knowledge and wisdom to interpret the Holy Quran 
to deduce such laws from the principalea of Shatlah as are 
suitable to the condition* and cercu romance* of tbeir time and 
place aod administer them io tucb a way as to fidfil the ohier- 
live of the lawgiver. ° ;eC 

The principle, of Shariah are unalterable, but the laws de- 
duced from them by human agency ar* subject to modification 
and revision, The reason i, that the former are Godgiv«n, fc c 
hlter are m.n.made. The principle, Shariafa are applicable 
to all age,, places, affair, and need,, but the laws are dedocedfrom 
these principles to deal with paiticular circumitance, and caies- 
Some Essential Conditions for Re -codification 

Hence there is ample provision in Islam for modification in 
rV P -°^ dcd thil lhe mo *fi««i°° conforms to the principles 
Thf u t0 ChlDStd cem **™ and circumstances, 

authorised to .nfer orders and administer affair, according to the 
ctrcumstancc» of rheir age aod their environment. 

„ h ;V S a °V haC iCh0,a,s afor,f have been given 

right to the scholar, of subsequent ages. Vet , bis does not 


n»«fl a free JiceQie to everyone to modify laws, distort the 
pnnc.plci and doriYfl crooked argents from them according 
to hii desire, whim or Taney, and deflect the laws from the real 
objective of (be Law-Giver. There ii a code for exercising 
- IJtth&d, which consists of a few condition* :— 
Ibe Fir j (Condition 

The first pre requisite for framing detailed laws is thai ,he 
legist must Hilly imbibe the iplrit or Shaiiah.i For this the legist 
musi reflect on the teachings of the Qumn ind ihe Jifc of the 
Holy Prophet (peace and bleixing* or Allah be on him). 

A person who make* s deep 2nd extensive study of both 
will be able to grasp the spirit of Shiriah and ihii in sight in 
the spirit of Shariah would will guide bim on every occasion to 
ttizh courie of action which is in line with Iht objectives" of 
Shitnaband which course or action would upset the balance of 
Shariah. Such alterations and aodtfestions in laws as are 
made by erudite men who have gained insight In the spirit of 
Shanah will not on ly be appropriate sod balanced but in their 
particular context, as good as the law given injunction to meet 
the law givers mr eo tj OII . Several caws may be cited to illustrate 
this point. For example H.drat Umar'MAllab be pleased with 
him> directive that Hadd puoliament shall not be paised on 

I- ft »oetd not b« QU ( ef ptaci to pciot cut ticra ,hai lbe „.;„"" 
reaion for jlammlnnte doer ot//#/*erfia o Vr day, it ibai the study of 
Qor.n and the lite ef .he Her, P, op h t t Muhammad < P «ce be on bio,) b.»e 
c«n oit,»dit e d from th« *VHabi ofcur Rell|iou. Eduratioo and in ibtir 
Place one „r the di he r k S^oJ z t jump'udtic* ,t ircw periled m ibeeearaa 
".study. Again even it a < iU rsc on jurisprudence a liuafat in lucbi 
manner that ibe imd«Qt to p«icei»c (be iral difference pod distinction 
between (be Uni ccutainini ib« irjuociious tt Allah and His A post* 

EH 8 !*.* °° J 1 " 0 ™* ,h < * ardi£ " of ltic No hedy can ,alu |asi|ht 

it iJi'/s. ,pi "i of - riiim iod w p,incipiei * «•■«* ■« 

M«5fS k. ! P "'"^ " udy cf *eHolr Quran and the life of tbe 
Hoty Pippbst ( and blessing 01 Allah t>a upM hiojj. Thia eom- 
Pienetiiton I* aa eracntia] pruequliiu for ib« caercUe of Utikad bat It 




Muslims durine war ; pardoning of Aba Mahjan Thaqafl by 
Hadrat Sa'ad b. Abi Waqqas who wai charged for drinking 
J.qour, a AfldJ crime or HarfraC Unar's decision suapendmg the 
punishment of amputation of hand for theft during famine. 

On the face of it, these directive; appear to be in conflict 
with the express orders or the Lawyer, but anyone who has 
some insight in the law of Shariah knows (hat these exceptions 
to Ihe general rule under special circumstance! were quite in 
consonencc with the spirit and objecti\e of Shiriah. 

Tn the same category is the c»ie of Hadrat Hatib bin Abi 
Balta'ah's slaves. A man from ihe irib* of Muzaina com- 
plained before Hdarat Uraar {Allah be pleised with him) that 
Hatibs slaves bad stolen his. camel. Hadrat Umar (AH&b 
be pleased with him; ordered to cut the hands of the thieves 
but later rescinded his order, observing, u You exacted labour 
from these poor men. but gave them no food and reduced tbem 
to such straits that even if they bad eaten something unlawful, 
they would be forgiven." 

Hadrat Umax (Allah be pleased with bim) acquiited the 
slaves and directed their master to pay recompense to the camel- 
owner. Similarly Hadrat Uma t *s (Allah be pleased with Mm) 
rulm8 ia the case or pronouncing divorce thrice at a time Was 
also at variance with the precedent established in the Holy 
Prophet's (peace and blessing, of Alfah be on him) time. Lut 
since* all these modifications in existing orders were made whh 
full cognizance of the spirit of Sbaiiah no body ever held them 
as ud sound. 

In contrast to it any amendment in the existing Older which 
is made without this co f nizance upsets ibe balance of Shariah 
and causes disorder. 

The Second Condition 

The second important condition for acquiring insight into 
the spirit of Shariah is to take a comprehensive view of all the 
orders of the Law-giver in that particular field of life wherein any 
legislation or ruling is needed aad to ascc/.aio. after deliberation, 
the object of those lawi.tbe over-all scheme of the Law-giver 


in that field and its impact ia the wider scheme of Islamic life 
and the policy of the Law-giver as a whole. Any Lav? framed, 
repealed or amended without full appreciauon of the will of 
(he Law giver, would violate the object and spirit before the 
l aw-giver and cause diversion from its epicenter. In islamic 
Law, spirit holds precedence OTer letter. The prime function 
of the legist is to concentrate on the object, intention and 
expediency of the law-giver. There are situations, what, if the 
Itltcr of the law (drafted in general terms) is adhered to. the 
spirit is violat3d. In such cases the letter should be sei aside 
and a course calculated to fulfil the spiiit should b.: adopted. 
The extreme emphasis rn establishing good and eliminating the 
evil m Ibe Holy Quran is quite obvious. The Holy Prophet 
(peace and ble-sings of Allah be on him) al»o laid great stress oa 
the point. Despite this he (peace be on him) lorbadc armed 
revoit against the rale of tyrants and oppressors, for the object 
of the Law-Giver is to transform conflict into concord. It is 
better in avoid an action that may lead to a greater wrong 
without any possibility of the rescoratiou of right. In Alhma 
tt>n Taimia's Btoaraphy it is related that during the Tartar 
turbulence, he chanced to pais by a party of men revelling io 
eating and drinking. Th; Allama's companions tried 10 
remonstrate with the revsJ|?r5. but the Alluma stopped there and 
observed : "Allah has forbidden wine to shut ibe possibility of 
strife and discord and here wine is stopping thssj people from 
indulging in a greater wrong i.e. plunder, murder and licsiiuc- 
lion. Now when ihey are in this state it would be contrary to 
the objective of Shatiah to slop ibem f:o:n drinking wins." 

This shows that rules may bz modified according 1° »bc 
special nature of the circum^aaces, provided toe mwdiika- 
tion fulfils rather than m> the objective of Sharia.i. Siauiftily 
there are certain rules which were worded in a particular 
language under special circurastaacci. Toe legist is, therefore, 
not duty bound to follow the letter of these rules under any 
circumstaucew On the contrary he should ascertain the real 
objective of ;hc Law-Giver from the letter of the Uw and frame 


Ee^KOlfiC ItATEftr OS IU-aM 

suitable rules for the achievement of that objective For instance 
the Holy Prophet (peace aod blessings of oa him) bad 
enjoined the giving au«y of one M*« of dale or barley or candy 
as Sadqa fltr (Charity on Eid-ul-fitr). This does not mean that 
the standard of weight U. S*'a current la Medina at that time 
and the commodities mentioned by the Holy Prophet (peace be 
on him) are statutory obligation*. The purpose of the Law- 
giver is merely to make the affluent give away at least such an 
amount in Sadqa as may enable a destitute Muslim brother to 
give a better time to his family during festival. This objective 
may be achieved by any other method which" is proximate to 
the form suggested by the Law-Glvn. 

The Third Condition 

Again it is necessary 10 onderstand well the principles and 
modes of Divine legislation, so that the lame principle* and 
modes may be adopted in fraoi.g riles in a particular set of 
circumstances. This understanding cannot be acquired unless a 
per son reflect! on the form of Sbariab as a whole and characteris- 
tics of each law separately. 

How does ibe Law-Oiver maintain equity and balance 
among the laws ? How dees He make allowance for human 
nature ? What methods docs He adopt to eliminate evil and 
fulfil His objectives? In what form does He organize and 
regulate human affairs 7 What ccoue does He adopt to lead 
man to His elevated £obis, making at the same time, suitable 
allowances for natural human weaknesses ? All these questions 
require thorough study and reflection- It is also nece sary for 
, this purpose to deliberate on the letter ond spirit of the Quranic 
injunctions and the wisdom of the statements and actions of the 
Holy Prophet (peace and blessings of Allah be upon him). Any 
one who has made a thorough and intelligent study of this branch 
of Knowledge is qualified to introduce partial amendments in 
the laws to suit the requirement* of the given situation. 

Further where a dear injunction from the Quran and the 
Sunnah is not available he frs authorised to frame a new law, 
for any course adopted by such person for fyihaf will not be 

.►cotok*™, of Eo^ote law, w wnu, TlUB! 303 

^ * 0al 'f « "«i^«io n . For inmpce 

Ihe Holy Quran ordam! the l»vyia E of y« /a <Pol ,. Ux) 0 „ . 

M» t ofTr' ^P?*"™ 0f,be °' d " ° f « ««" 

il« cf h CaJ ' Ph, ' A " JL * pleMclJ «""! 

Iter own r«po n ,ibil,ey lh , lawl lh efllcled ™ 

circuaufco.i., ca inS c. h.v e occurred f,o n ,tc vi«, p0 "1 2 
each new circumtUocc ? "quirea by 

wtat lyp« a, rule cor^T^b «, ™r. '„ "5 
..Id. dmil,. » t ~ 



1. Chafes that have occurred because of change io social 
environments, a natural codiequcace of the academic and intel- 
lecraal development and evolution, increasing discuveriej of 
natural resources, advancement of material means and re ources, 
facilities of transportation and communication, alteration in the 
raises of production and the expansion of international regions. 
Such changes are quite natural and real from tbe point of view 
of Islamic Law. They can neither be eliminated nor j nt our 
objective to eliminate them. What is required is to frame fresh 
laws on the principles of Shariah to meet new situations In 
ecMioraic affairs, financial dealings and business transactions, so 
that under the changed circumstances, the Muslims may order 
their conduct on pure Mimic pattern. 

2. Changes which are not the natural consequence of 
social developmeLl, but have occurred due to the hold of \icious 
Capitalists over the economic system and financial artalrs of Ibe 

The same oppressive capitalism, which exised in the pa-jan 
days' and which remained suppressed under Hlam for several 
centuries, has once ngain got hold of tbe world economic order 
and with the help oraovanccd social resources it has introduced 
the sa/ne old doctrines in ever new forms in various fields of 
economic (ife. The changes that have come into effect because 
or (he of capitalism ore not real ct natural but 
entirely artificial in the eyes of Ishroic Law. The« changes can 
he undone by force and Eheir elimination is imperative for the 
weii'are of mankind. It j$ ibe cardinal duty of a Mus its to 
eliminate these changes with all the force at his command ar,d 
recces. ruct the economic system on the princi, les of Islam. 

The fight against capitalism is obli^--iu;3 for ;i Muslim 
m'Jcb more than the Communist For a comr^ui-ist it is a 

l Here teem "Cspittliim" is not belr-j us«d in it* ot*w. Iirr lcd 
irciticfli iertse, buc in its w«ler teal conte*i. "Capiullsm" in ji» 
lc;i'-DKiil is trie p.oduct of ItCuiirlaL Revolution >a Euti»pc. Bui 
(be r-a l capitalism ia uf ancicot or fin atjd bas exmed la iU vaiiofc* 
forj=s si a;*? the tiruewaeo man surrendered tbe leadership of tiscullyral 
dad noral life to satan. 


matter 0/ bread and butter only, but for a Muslim it i* a matter 
concerning his religion and whoje moral set-up. The Communist 
champions the can*: of tbe Proletariat, the Muslim G«Lts Tor 
tbe real interest ol the entire humanity inciiiding the capitalists. 
Tbe struggle of the communist ha* a selfish end while the aim 
of Muslim simple b to earn Allah", pleasure. Hence the 
Muslim con never compromise with the oppressive capitalist 
system in vogue. Anybody who » a Muslim and nets according 
to Wam, he is duty bound to do nil best to do away with 
vicious system come whai may. The Jaw* enacted by Islam in 
the economic field will not facilitate the absorption of Muslims 
in the Capitalist system and their participation in its institutions 
to make it a success. lis M \ e aim would be to safeguard the 
Muslims as well a* fhc whole world fiom this evil and slamming 
all door* or development on this opprcvive and uujust system. 
General 1'rloctplej of Comtmimiaa 

Islamic Law haa made ample provision for tbe 
rigours of Law according to ciccunulanccs and needs Hence 
one of tbe principle* of Fwjh states ; 

"Some unlawful things hecomo lawful under Jhc compulsion 

of ne*d r "and'" Where the observance of law of Shur.ah 

becomes rigorous, there the law is eased." 

This principle his been alluded to at several places in the 
Holy Qurnn and the traditions of the Holy Prophet (peace 
blessing? of Allah be on him), tor fiance : 

"Allah taketh nor a soul beyond its seope." 

"Allah devrreth for yodeaw. He -^ireth not hWshir r> t 

"Aifah hath nor laid upon yoi H religion nnv hardship " 
And in Had it h it is re'atcd : 



"In I B ] a m tbera fi no barm or hardship." 

haJ/Tha™ " "" blijhcd P rf »** bM«nlhtt where 
rigour or harm .s involved, !he Uwt shall be softened. Yet 

, t does noi rne, n that the law, of Shari.h or the limit* ordaioed 

b^Ood should be set ^ to f u ]„, an ima.inary or capricioo, 

There are some rules and regulations for softeoica the 

lT t h°I 7 wh, ' cb ean be un<le « 100 ' 1 

degree of htt«I.Wp „„„ be C[eul tb: , ; * 

Sb.n.h CanncI be relieved in CT «y c«e of nard.hip, o.herwi* 
Ihe : very concept of i.w would v»oilb. The h.rdsbio of MmiZ 

Jihad (holy war), all lh C! * or- ewuiniy hardsh^ Rut rhrv „ r - 

»m«vTi • ,k P V h ! r - The c,,nd " lon r " comwrtoo or 

" illness for whirh r v ! 1 i>ine doWn posilioD ' F<* 

A man wko Zi p h£ r^^* * bote of 

P rc$ene b " Tlfc ^ dnoJtinga cup of wioe or a 


meisel or two of uDUwrulfood, i* not authorised to exceed the 
limit imposed by bis need. 

Similarly it is unlawful for the physician to see more than 
what [s absoioiely warranted by professional necessity of the 
private parts of a patient's body. Thus the permission and 
commutation will be determined according to hardship and 
need in each case. 

Thirdly, no device may be adopted to remov; any difficulty 
at harm which may cause relatively greater harm or create 
greater difficulty. Only those devices will be permissible whose 
barm is comparatively tester. Similar lo it is the rule that It is 
unlawful to get involved In an evil of greater or equal magnitude 
while trying to avoid some evil. Nevertheless when a person 
is caught between two evils and cannot escape making a choice, 
he ihould opt for a lesser evil to ward off the greater one, 

Pourtbly, removal of evils has priority over achievement of 
better objectives, lo the sight of Sbarlah It is more important 
to ward off evil and to avoid the unlawful and dispel anarchy 
rather than do toed and fulfil one's duties and obligationt. 
That is why the Sbarlah is more liberal In easing the rigour of 
obligations than in granting allowance and relaxations for 
prohibitions- Concessions have been awarded In the matter of 
journey and illness in (he prescribed prayers or fasting and other 
duties but no relaxation has been allowed for the use of 
impure and unlawful things. 

Fifthly, with the end or removal of rigour or hardship, the 
concession lapses. For instance when the illness la over, the 
allowance of Tayammum expires. 

Some Forms of Relaxations (relating Interest) 

Having grasped the above stated rules, let us now ponder 
over the relaxations that may be allowed in the Taws of Shariah 
in the matter of Interest. 

1. The acts of charging and paying Interest are not similar 
in character. One may be compiled by cecd to raise a loan 
on Interest hut there is absolutely no compulsion for charging 


eoo.vo*f rc starm of 

interest. Only a ncaKhy person ca D lend money on Interest and 
there ,a no point of compulsion for a wealthy person to make 
tSftf unJawful act lawful for him. 

1 -Again every need for raisin* an Interest- baring loan 
cannot be considered as a real compelling nesd. Extravagant 
spending on marriages ot occasions of family joy or sorrow 
is no real compulsion. Purchase of a motor car or construction 
of a house is also not a genuine compulsion ; 

I - Such needs are often wrongly termed as emergency, hence 
borrowing huge sums of money from banks or money- 
lenders on Intetesi can by no means bo jusiiCed in (he 
eyes of Shanah Law. Anybody who borrows money 
on Interest on such flimsy grounds commits a great sin. 
Bxcepti.n to this law can be granted only in the case of 
such emergency where relaxation in unlawful becomes 
inevitable i.e. any calamity or a serious threat to life or 
honour or any h^hip beyund one's Capacity, in 
such exceptional cases, only, is a Muslim permitted to 
borrow money on ictereat But all those Muslims who 
had resources enough to help their brother in faith yet 
they did not come forward to save him from the curse 
of Interest would stand at defaulters and sinners. 
Rather the wbole cation would incur the wrath of 
Allah as they did not care to organise Zakat and 
Cbarilics and thus rendered tbe poor and the have-not 
quite helpless and *iih no option but to beg the money- 
lenders for help. In case the Muslim community has a 
government of their own, ;be government, ts such, 
would be sinner. 

2. Borrowing on Interest is permissible strictly to lha extent 
of inevitable need, aa d rhe money so borrowed should 
be returned as soon as possible. It is quite forbidden 
to pay a penny iu interest after the emergency is 
over, and ihe to/ewcr is in a position to pay back the 
money borrowed on interest. Tbe question, wbtthcr 
there exists an unavoidable eoerfiency or no- to jnirjjv 


borrowing on Interest and when that emergency is ever, 
entirely depends on one's own sense of piety and fear 
of Allan; greater the fear of Allah, the more is one 
cautious and careful, 
3. Those, who remit their money in hanks because of 
commercial exigencies, security or wiih a view to safe* 
guard their ftitare interest* in a disturbing national 
situation, or tboae'who purchase insuiance policies, or 
those who contribute in the Provident Fund under 
certain conditions and regulations, should consider the 
principal money as their legitimate property and should 
pay 24% Zakat per annum over this money. Those 
who are the worshipper* of Allah and not the wealth, 
their money would not be purified until! and unices 
Zakat i* paid on it. 

4. Tho Interest money accruing of one's deposit with the 
bank or insurance policy or Provident Fund should not 
be left with the Capitalists to the benefit of the 
exploiters. Rather thi* amount should be spent to help 
such needy and r«ourc*le* per»ous who are pressed so 
hard financially as to justify relaxation in the unlawful 
for them. I 

5. All the profits accruing from monetary or busioes* 
transactions that come under the purview of interest or 
carry any doubt of interest should be avoided as far es 
possible, but when inevitable, Lhe amnunt of interest 
should be disposed of in the manner at Slated in point 
No. 5 above. An honest and sincere Muslim is sup- 
posed to work roc the elimination of evil and not for 
his own selfish interests. Whoever fears Allah and 
brieves in the Day of Reaurreciion tries bis best to 
avoid all the unlawful practices however prospective and 


1 aarcewjihihis idei. btcausc tM interest is biakstfy procured 
from those in need, n-iy it he government trcuiy. bank or 
Insurance busiuesj, th* m*ia sources of procuiinj interest every 
wheje are the poor and the needy. {Author) 

profitable in the interest of business and save himself 

from the wrath of Allah. 
Thraa relaxations are meant only for the individuals 
bat may be ei-ended to a nation as well when it ii subjugated to 
other* and is not Independent enough to work out its own 
financial and economic system. But in the caie of a free and 
independent Muslim nation, having full power and authority to 
solve Its problems in its own way. «o relaxation or concession 
can be claIo::d in the matter of interest until! and u D |ess it is 
established barking, trade and industry and the whole 
financial svst?m can not work without interest and that there 
Is no alternate la it whatsoever. This is theoretically baseless 
and practically * rung. In fact a financial system can be worked 
out and implemented successfully without the element of 
interest- He=« there is no point in insisting on Western 
Capitalistic System except that it has been decided to rebel 
against the Creator aod defy Atlah-the Almighty and